Jul 30, 2020 City Council on 2020-07-30 8:30 AM (SPECIAL CALLED WORK SESSION)

Welcome everyone to this meeting of the Denton City Council on Thursday, July 30, 2020. It is 839. We are in a special called work session. We're beginning our budget process. We do have a quorum, so I'll call this meeting to order. We only have one item on this agenda, and it's a work session report, agenda item 1A, ID 20-1151, receive a report, hold a discussion, and give staff direction regarding the departmental presentations in preparation for the fiscal year 2020-21 proposed budget, capital improvement program, and five-year financial forecast. And I guess as far as, David, if you'll help me out as far as just the process, do y'all want us to hold questions until after each individual staff presentation, or are there breaks in the middle, I mean, what would best facilitate the presentation from staff's perspective? Each of the presentations are pretty short. That was a priority going into these presentations, so I think we can get through each of them and then take questions. Okay. I think that would work. There are, when we get to electric and some of the larger ones, we do have a natural break where we switch from operations to financials, and we'll have an opportunity for questions in the middle of those presentations. Okay. Good deal. Thank you. Good morning, everyone. Before we get into the departmental presentations, I have a very brief few-slide presentation to talk in more detail about assessed values and where we are right now with the appraisal district. This is a follow-up to the brief discussion that we had during the Tuesday council meeting as well. So, again, this is high-level just to give you an update on where we are, and definitely at next Thursday's meeting, with a presentation of the proposed budget, we'll go into much more detail on these figures. So the assessed value and tax rate assumptions are 2020 appraisal process, obviously has been unique and different than prior years, as obviously this year has been unique in many ways. The appraisal district had protests that were significantly higher across all entities, and this is obviously something that is seen throughout the state, throughout the country as an impact, and it's particularly in Texas with our appraisal process, just more protests coming in given the economic situation. The ARB, to compound that factor, the ARB review timeline was also delayed as the appraisal district moved to a remote viewing process, a review process over the past number of months, so that transition for them also delayed their timeline. The third bullet point is significant, obviously more particularly to Denton, a central appraisal district. They implemented a new software this year and have had issues with the software. That's from our perspective, that's resulted in us getting fewer of the preliminary estimates throughout the process, and then ultimately, at this point, not getting the certified totals that we would normally anticipate, and then we'll show some of the impacts of what that means for the amounts under protest moving forward. As I mentioned on that fifth bullet point, the appraisal district provided us a certified estimate last Friday. This is instead of the certified totals that they would normally send on that July 24th date, which is the date that is prescribed to either send us certified totals or certified estimates by state statute. What that means is we don't have a firm number going into the budget. We don't have a firm number as we calculate our no new revenue tax rate, formerly the effective tax rate, or that voter approval tax rate, formerly the rollback rate. Again, we'll get into, on the following slide, what that looks like in terms of numbers and how we're approaching it moving forward. You can see there, within the estimate that they gave us, over 8,000 parcels are still under protest, and about 39% of our total value is under protest. We'll show this following bullet point on the next slide. We're currently assuming about 85% of that value under protest is approved moving forward. That's based on prior year in 2019 of all protested values, about 87% were upheld, so about 13% reduction in those values. Our assumption moving forward from a budget perspective is that 85% of those values would be reinstated. We are going to continue from this point until September. We'll continue to get revised numbers we anticipate from the Appraisal District, so we'll be able to adjust that budget number as we move forward, and hopefully we'll get a certified total from the Appraisal District in September. - David, just real quick, I'm sorry. I know you've got the numbers on the next slide, but just from an understanding of the definition or the paradigm. When you're saying 85%, so let's say for instance, there's still, you said there's 30, 40, there's still, let's say, a billion dollars under protest. When you say 85% of the value under protest is upheld, do you mean that the protest value submitted by the property owner is sustained, in other words? Of that billion, you're assuming $850 million would be moving forward, and 85% of that billion, is that how you're calculating that? - Right, so we have the new value would become 85% of that total, and a reduction of about 15%. - Okay, all right. All right, thank you. - No problem. So here to add some figures to what we discussed and show the difference in what we're experiencing this year to prior years, you can see that the top row there is what we have now in the certified estimates that we got on Friday, where we have 40% of our value still under review. So that kind of going forward on those, through that row on the columns, you'll see the certified value of about 8.8 billion. That's the values that I'm not under protest, that the appraisal district is confident in and says these are certified and you can move forward with them. The $5.6, $5.7 billion in protested values are all those values that are still under protest and going through the process. What we've shown there on the third column is our assumption on 85% of those values being upheld so that takes those $5.6 billion in protested values and knocks it down to 4.8. So you'll see that on the next slide. Again, that's right now as we enter into the proposed budget, it gives us something to work with 'cause we have to have some estimate on what those assessed values are so we can start anticipating what a property tax rate would be. But our hope is as we go through the year, or we'll go through the next month or two, that property's under review percentage decreases, we get more certainty in the certified values and we're able to continue to provide council updates on what that means for the property tax, what those ramifications are. But we do think it is important to show the difference in what we're experiencing this year to prior years. You can see the bottom three columns, the past three years when we get those certified totals, which we would have gotten at the same time, range from two to four, 4% outstanding, which is why obviously the Appraisal District feels confident saying that those values are a certified total as opposed to a certified estimate. - And one other question, I'm breaking my own rule, I apologize. I guess, and if you're gonna address this in a different slide, let me know. Because on that 5.6 billion that's still under protest, what I'm hearing you say is that we're saying that all those property protests, they aggregate together, the settlement or the review board or a trial is only gonna result in a 15% reduction from the originally assessed notice value to what is eventually settled upon. And I'm really, I wouldn't say really concerned, I'm a little concerned only because I know that when you're only dealing with one or four or 2% of those properties, but depending on what those properties are, I mean, I'll just be truthful. I mean, several, I've heard stories where people's assessed values were up 30%, 40%, and they were reduced back down to real close to where they were. So a lot of that's gonna depend on what type of properties those are, if those are multifamily properties, if they're... So I'm assuming you're gonna talk about the contingency that if somehow that changes to where it's 20 or 25% reduction, in other words, we're only 75%, 'cause that's gonna have a substantial impact on the budget. So anyway, I just... Okay, you probably got that right here. Well, I definitely can try to provide some context on why we chose the 85%, but those are the questions that we've been wrestling with over the past week of how do we wrap our heads around this and what are the best assumptions to make. So first, we leaned on the history, right? I mean, last year, the pre-regulation provided us numbers that said 87% were upheld. So obviously, took a slightly more conservative approach than 87% and went with the 85%. But I'll get into this slide, but I think I can point to one number at least that may help wrap it in context. If you look on this left table, you'll see the protest value, the lowest value. So that's 4.3 billion. That's about... It's close to 80% of the value of the protestant amount, that $5 billion number. That is what the pre-regulation is telling us is essentially the lowest we could possibly get. So that just creates a range, the 4.3 would be the lowest, the 5.6 would be the highest. So 85% obviously is in between that range and what we chose. So just, I mean, again, I apologize, but I think if we move on, I'm gonna forget my train of thought. So on the protest value where it says lowest value, you're saying that if we could pull the slide down, just 'cause I think I have to be shown why I'm talking, at least according to the city attorney, on that lowest value, you're saying that that's the estimate from the appraisal district that says we've got $5.6 million worth of notice value. We can't imagine after all, it's all settled and done, the dust is settled, the protests are done, that that 5.6 at its lowest would be 4.3. That is an estimate from the appraisal district. Correct. Right? Okay. All right. Okay. And as far as moving forward, I think that's why we just have to take a kind of a nimble approach to this budget year. The proposed tax rate definitely won't be the tax rate we have at the adopted budget. So we'll have to just continue to come to council as we get more information. If we get, if it knocks down to 30% outstanding and more values and the values are being reduced more than 85%, then we'll have to readjust and present to council a revised estimate. Okay. Thank you. Yes. Since I had a question, I'm gonna open it up. Council Member Meltzer? Very fair. Not really. But go ahead. I'm just kidding. So is obviously the large percent that's under protest is because of the high unemployment and tough times, but are the appraisals up by that much as well? Like is it a combination of appraisals being up and individuals' resources being tight? And the reason I ask that is, if it's based on, if the end result is a product of the appraisals, not so much the ability to pay, if it's that the appraisals have gone up, I'm just wondering, is there some probability that it would be more likely to come back to what it was last year rather than, like you're saying 87%, does it, let me ask you in a different way, does 87% of the appraised value put those values about where they were last year or still up or still down? Sure. I'll talk a little bit about that in the aggregate on this slide. The 85%, it's about a 4% increase in total AD for us. Now some of that 4% is new value. So you're right. At that, it's probably, it's about the same as most homes would have been. Okay. So they might beat it back down to roughly where it was. I would... Okay. Thank you. Yeah. That helps. Council member Briggs. On the line for frozen values, is that amount, how does that compare to last year? We have, it's slightly higher and when we have the proposed budget presentation next week, we're going to go into detail on that and what that looks like, but it is slightly higher than it was last year. So we've had more folks obviously getting on, as this is the third year of having the frozen values, more have gotten on. It hasn't been that drastic increase that we saw over the past two years. So it's starting to level off to some degree, but we will definitely have that detailed out so you can see how that's changed. Okay. Council member Davis. My question, David, let me know if this is something better addressed in a different presentation, but I think this is the time. My question is about collection and obviously that's not a business we're in. We get that money back from the state, but I'm concerned about where we build into our assumptions collection rate on tax revenue. We all know that people are protesting because they're in tough times. Commercial properties, I would bet, are in a higher protest level than they ever have been in Denton County. And with all the business closures we see, it's not long before folks decide they can't afford their tax bill. So where do we build in the process assumptions about a lower than average collection rate, which we can probably anticipate for the coming year? Absolutely. That's another thing we've been talking through, obviously with this uncertainty, but also every time we budget. So in the current budget, we projected over 99% collections rate. So we actually include that in our budget when we show you the projections on here's how much revenue we're going to get from assessed value. We have a number in there. We're going to reduce that and go lower on our collection rate. I think right now we have 98% included. So we could go lower than that. What has happened in the past is we usually actually collect over 100% of our budget because throughout the year there's supplements, there's changes to the certified values that typically have come in higher, so we end up collecting more than we had initially budgeted. But knowing the situation we're in, we're going to take a more conservative approach and just assume lower collections going into next year. Okay. All right. Thank you. Council Member Armitage. Say that we don't get the numbers that we need come budget time, the time to vote on the budget in September, can we assume that the date to vote on the budget would be postponed until we actually have those numbers? The date to vote on the budget is prescribed in the state statute. So we'll have to vote on the budget kind of regardless of what information we have. So obviously that puts us in this situation where we just have to make our best assumptions. Obviously we're going to continue to get information and make those assumptions. But we don't want, we're trying to navigate to two ends, right? We don't want to set a tax rate too low that we don't collect as much as we anticipate in the budget and base our budget on that. But we also don't want to have one too high and we collect, overcollect what we need. So that's, it's just going to be, it's going to be a difficult process to go through, but we'll definitely continue to come back to council and say, here's our thought process and lay out exactly where we are. Thank you. And can I ask a follow up question to that is, is it because surely other, I would assume that other cities are experiencing this right now, is there a possibility of petitioning the governor or being prepared to do that if it comes to that under his emergency powers to extend that date? After that question, Barry, we need to get back on topic of the actual budget because that's, that, that is so hypothetical that we don't even know. So that's how, that's my thinking, but I would say that I would, there's, there's a tight timeline to get your, your values out and the bills out to, to residents and what they're either because the tax bills are going to be due in January, in December, January. So to, to push it any further than September would probably be tough just from a standpoint of trying to get the bills out and what is your tax rate that you'll be paying on. So I think there's a number of factors that would complicate pushing out the adoption rate. I will just say, yeah, go ahead. Just one more slide on this before we get to the department presentations. So this slide wanted to just very quickly walk forward our thoughts right now on kind of what this means for, and let you know what this means for the effective tax rate, no new revenue tax rate considerations and how we're approaching it from a budget standpoint and what the actual tax rate implications of the AV discussions are. As you recall, we calculate our no new revenue tax rate, and ultimately we'll calculate that rollback rate, that voter approval rate each year, the no new revenue tax rate will be based on the certified estimate. It won't be updated as we move forward. So what that's going to mean for us is we're going to have a no new revenue tax rate, that effective rate again, that's higher than our current rate by, by a couple cents probably because by there in that calculation, they use the lowest value. So we're going to have a certified estimate and what's used in those calculations of an assessed value that is lower or right at, you can see right now we're predicting about 1% of what it was last year, which is going to mean that that rate will be higher. So we don't believe that we're going to, you know, under this assumption that we're not going to have the lowest values of all those protested values come in, we don't want to move forward and assume an effective tax rate based on this calculation, because ultimately we would very likely over collect what what's necessary. And obviously we always over the past three or four years built our budget around that effective tax rate at least start the conversation at the effective tax rate. So I wanted to be transparent about that, about that with city council that you're going to see as we make our publications and things and, and all the other steps moving forward, an effective tax rate that's higher than what we're proposing and even higher than our current tax rate. So what we've done on the right table is we've begun to try to say, okay, well, with the projections that we have with this 85% protest value, what is our city calculated effective tax rate. So that's what that 58 cents is, is there as opposed to on the, on the left table, about 61 62 cents is what right now we're projecting could come out as the effective tax rate. So again, just wanted to make that clear, and we'll have much more detail on that next week and more, more precise numbers on what those will be. But that's why the conversation is going to be a little bit different than strictly the effective tax rate because of this. David, real quick. Do you know the percentage of under the city calculated? How much of that is new value? It's right now it's about 480 million 490 million. So no, no, no percentages. That's fine. The total is great. That's helpful. Thank you. All right, so we're going to proceed then with the departmental presentations. Is that? Yes. Yep. So we'll proceed with the department presentations. Obviously, we have a lot to get through today. And then we'll have police on Monday, and then a few more on the fourth. And then obviously, you know, the hope of going through all these presentations is and what we've seen over the past few years, it really makes that proposed budget presentation next Thursday, a lot more smooth and we've already gone through a lot of the details so that we can touch on what we've already discussed and bring any of those decision points forward. So unless there are any other questions on what I presented, I can hand it over to our first department and Danny Kramer can present. Thank you. Thank you. Good morning, Mayor Council. Morning. My name is Daniel Kramer, Deputy Director of Operations for the Public Works Department. Today we'll be talking about the street department budget. So over the over the past year, we've got sorry, I had to move the pictures on the side. Over the over the last year, we've got a few things done as we've been moving our focus more towards maintenance and less towards focusing on our major reconstructions. We've been leaving that a lot to our capital improvements department. Now we were able to hit our our goal, which is between five to six lane miles per year of reconstruction. We've also had a solid micro seal program and crack seal program going on this past year also. So as we move into our future goals, we're still going to continue to focus on our micro seal and crack seal contracts, which is part of our our maintenance as we've talked before how we need to do something to every street every two to five years in order to keep it the good streets good and keep our OCI climbing and work on that. We're also going to be expanding our planning activities and trying to focus on on more of those. We do have a very solid setup for our our major maintenance, our reconstructions and our mill and overlays and scheduling and everything. So we're going to be focusing more on getting our our minor maintenance and getting the schedules confirmed more on those and be able to get that more into a solid state so we can see where we're going forward and our continued focus is still going to be on increasing our OCI as we go forward. So some of just to touch base on some of the stuff that we talked about last year, you know, through our backlog, which is our streets that have a lower than 45 OCI, we kind of look at, you know, the industry standard across is the number that we're trying to get to, which is roughly 10 percent, which what that does is that allows us to be able to as streets fall into the poor and very poor sections that allows us to be able to get them out and rebuild them and still keep our good streets good and be able to keep up with our log. Currently we are sitting at 25 percent, which is a small increase from last year we were at 24 percent and I'll talk a little bit about that on the next slide for some of those changes. Now we've done some estimates going forward and after we complete the 12 and 14 bond program we're estimating we're going to be at 21.5 percent on our backlog and we've also estimated with our completion of the 2019 bond that was passed this past fall we're looking at a number between 15 to 20 percent. Now the reason that is where it is and there's a big gap is we're also it's looking at how streets deteriorate and the curves and we will talk a little bit about that farther on but in part of that we do an actual pavement assessment every four to six years and we do actually have one going on right now in the city, IMS which is our contractors currently driving around they look to collect data for about four weeks in the city of all the streets and everything going on and then they would be putting a report together with all of our OCI's and where we're at and we will be bringing that back to talk to you guys when we get the report back. As we said with our our budget presentation last year our goal is on the good streets which is an OCI 45 and above we look to maintain slash inspect at least 20 percent and currently we are sitting at 15 percent and on track to hit our 20 goal at a minimum. This slide is what we presented last year in our budget presentation started with this and just kind of shows the distribution of our OCI across the city. As I said before you have the poor and very poor which is considered our backlog sitting at about 25 percent and then you know our our fair our good and our very good which is what we try to focus on in the streets department you know try to get all of our maintenance done and this is where we can get our best bang for the buck before it gets into a full reconstruct which is our most expensive way to go. What we kind of wanted to show here is kind of our improvements. Our first OCI study was done in 2003 but we used a different company for that one it was our first one that was done in the city this one was done by IMS in 2009 was our actually our next one which we chose that because it shows a very consistent data and it was right before the bond package was passed and kind of shows how we've changed over the over the past 11 years. So from 2009 to 2020 we can look on the left side we're looking at our our OCI scores from our very poor all the way down to our excellent and you can see under there the total lane miles that are in that section and those are from the the current lane miles 186 lane miles. So between 2009 and 2020 we actually decreased our lane miles by 32 lane miles in our very poor 31 in our poor and 55 in our fair. We increased in our good and very good by 108 and 155. So we pretty much did a swap so we have made close to 118 streets that have swapped into our our maintenance side from our poor and our backlog side. Now we did have a decrease in excellent streets and you know I want to point that out that the difference between an excellent and a very good street is very minimal. There's a few small small cracks in there the subgrade is still in very good shape there's no real issues and what that is just showing that's kind of I would say buying a new car and getting the first couple rock chips in it and how you're sitting on there there's a little bit of maybe a discoloration in the pavement it's starting to turn a little darker and that's when we'd be focusing on in the very good side to do our micro seals and crack seals to be able to get that going. So this is the basic life cycle curve of a street and every single street that we have has a life cycle curve set up it's based on you know the what kind of street it is whether it's a collector an arterial a residential so it's based on the kind of traffic that's on it the the size of the road the subgrade base the thickness of the road and everything. So as you can see our goal is to do as much work as we can anywhere from excellent to the good once you start going farther down past good into the fair and poor it starts getting more expensive and we start having a higher cost in the maintenance that's required to make sure that we keep our streets up and keep everything going the way it should. Some of the issues that we've seen over the past few years is probably because the increase from a 24 to 25 percent over the last year is we have a lot of streets that are kind of enough in the fair to poor area and that's the steepest part of the curve so they are going to deteriorate quicker we've also had a lot of construction that's been going on and it's we've kicked off a lot of construction but we haven't had a lot that's completely finished and been able to get every single street done and get the new OCI's in there because they're still under construction and you know when we get down to the very poor you know the curve starts to flatten out and then we start seeing very minimal drops from there when those streets get there so your biggest drop is from your good to your poor so we try to tackle everything before it hits into that section. You know moving into this into our extra pro forma we wanted to look at over the next few years reinstating the franchise fees and getting those back in last year we did take those out of the streets budget but we will be putting those back in roughly about 600,000 we're also looking at reducing our our fund balance as we go forward and pushing more and more money into maintenance into our crack seal program into our micro seal program and also our our mill and overlays and be able to get our streets and work on our OCI and be able to get some good streets in there and increase and decrease our backlog while increasing our OCI. So as we've been going through with our with the VSP and all the changes we've had we've had a few changes in the street department we started out with 43 total FTE's and we are now down we'll be at 38 FTE's as we go into the next budget cycle. So as we've moved some of these out we've gone through multiple plans on the best way to run to the department and as we think right now we are looking at running more efficiently with the way we have it set up and how we're going through it's going to be focusing more on the outsource and be able to utilize the crews that we have to the fullest extent and get that going and I'll show the kind of how we have set up the organizational chart. We have six crews total and how we're set up two of them run the construction which is the five to six lane miles a year and then we have a one crew that's focused on mill and overlay and what they'll do is the smaller mill and overlays some of the the bigger base failures and patches with that crew and then we have one that works with the the water waste water departments on some utility cuts and then the other two crews are our base failures our our patches our potholing and citizen concerns as we deal with those. Now we also have contracts for mills and overlays and pavements so we work those very hard and keep those going for our bigger mill and overlays they can come in more efficiently and get that done. On our construction side we've also focused on what we can do internally the best way so as we're running through our construction we will have a contractor come in and do the milling for us we will have a contractor do the curb and gutter and get that replacement done and then we'll work on what kind of is the more of the more expensive part that we're able to and we'll do the ground work we'll do the dirt work the base work and then move into having another contractor come in and do the pavement paving of that and then we'll clear everything up at the end so as we're going right now that's kind of the end so if there's any questions or anything I can answer please let me know all right if we'll pull the slide down we'll see if there's any questions okay sorry I'm technically challenged no no thank you I appreciate that thank you council member Melcher yeah so do you happen to have at your fingertips what the percent below oh oh sky 45 was in 2009 you know what like with all those changes I do not have that on me right now I can I do those numbers but I can get those to you that's kind of more of a point of curiosity I'm more pointedly I think I recall two years ago a similar presentation learning that the percent below 45 was in the neighborhood of 25 percent it was 24 maybe 26 you mentioned what it was a year ago but I think it was that way two years ago as well and I'm I'm well aware that there's a tremendous amount of activity going on I mean the most the most common things I hear from the general public or with let's say with the most emotional fervor is either fix the dang roads or stop fixing the dang road so much so but you know we're way leaning to the ladder so how can that be you know that in two years with all that effort I think it's has it been something like 150 segments have been worked on on that order in the last couple of years that that number does sound right I'd have to go back and look I don't have that at my fingertips but there has been a lot of a lot of work that has been going on in the past few years agree a hundred percent a lot of how can we not have changed the percent below 45 there's there's a calculation there's a calculation that occurs with the depreciation of the streets the IMS system that he's talking about and there's a there's a net expenditure above handling all of your depreciation and it's it's three to five million dollars of additional work above that depreciation amount that has to occur each year just to move your I see a IMS score up a point so we are moving the average time I'm just saying just even but even this even the lower end the scores are always going down roads are always degrading so I think what he was telling you is that they've they've got themselves a little bit better organized now they're also focusing their strategies more on that 45 to 65 area to keep those streets from continuing to you know to get down into that bad and poor area but I mean the bottom line is there were decades where we underfunded streets he isn't changing this in two years so you know we're continuing we're continuing to add as much into the street program as we possibly can the new bond program is extremely aggressive but it depends on our ability to get pulled off every year and then and then invest more than the rate of depreciation yeah I think I think that I think the so they're really looking at two or three different prong approaches and I my guess is it's going to take five or ten years before you start seeing meaningful changes to that OCI number and it just you just don't catch you know decades of not investing enough in your street program up it takes a while at this rate and especially when we're trying to contain the contain the tax rate and also competing against textile locally for contractors so I think in light of everything that's going on they are doing a bang-up job getting these things out the door and becoming more organized and finding their sweet spots which helps them get work out the door quicker yeah I'm not questioning the job done you know it's more like when do you see the numbers mayor if I can press press a little further I had a thought during this presentation where they where we may be able to see the benefit and I don't know if this is too heavy of a lift analytically but do do we have if we have some kind of a say a standard traffic number based on primary arterial secondary you know couldn't you do a sort of traffic weighted street miles and here's where I'm going presumably when we're working on the worst roads a lot of them are also the most heavily traveled roads right that's why they're the worst because they're you know they get beat up and you also get a disproportionate benefit when you fix those because more of people's actual trip miles are on good roads so you know is it possible that we have moved the bad road percentages out to less traveled roads by doing the work we've been doing you see where I'm going now there's let's say you got five roads in the whole town and most of the traffic's on one of them and that road is lousy well you fix that one and another one degraded okay more of the trip miles actual you know resident trip miles are on good roads then let's say you still have one bad road but now it's a road that people only go on twice a year I'm kind of making a cartoon of it so so the the metric that would show you that like I said it might be too much of a heavy lift to bother but maybe not here's the list of all the roads here's the sort of standard estimate of the let's say weekly traffic by road type and you have now you have a total of let's call it standard trip miles and now what percent of your oci is on crummy roads versus good we do have to say could be not worth the effort but it's interesting you might be able to see if you're making progress on actually impacting people's driving experience we should be able to have that and we can look through it and I'll get with engineering and traffic department and see what we can pull together for you if you think it helps you you know like don't do it to help me but you know I do I do want to answer your your question earlier if I could um ethan just sent me a note that in 2009 we had a backlog of about 28.6 percent currently about 25 and that's going to be those roads that are poor to bad so it's gone down almost four percent in the like which is pretty 11 years okay uh well and I would yeah well I can tell you uh there's a period in that 11 years not much was getting done um but but from the good to excellent in 2009 we were at 51 percent today we're almost 60 so yeah that's good it's starting it's starting to make some improvements and again as as as danny and his crews uh you know find those sweet spots as they coordinate better with uh water wastewater and then combined with the new um road projects that uh todd as this is overseeing it all just has this effect of slowly starting to get our roads back up there but we're going to have to keep the level of investment at where it's currently at or or increase it which is something you're seeing in our budget um is is we're drawing down fund balances and getting as much money into that street rehab program as we possibly can right now well if you keep doing things like fixing you know that most travel segment of hickory like what's coming up yeah right you'll have a disproportionate impact so right all right thanks councilmember briggs thank you I have um just a few questions one while we're talking about very poor and poor I think I added 390 lane miles and at one time I thought we had a map of that of the oci and where the those are I would be interested to see what part of the city and where around the city those um those lane miles are um and on the o and m expenses it's a pretty large sum and it's not divided out and I know there's a lot included in there and at one time as we were filling potholes with all the rain I remember um someone mentioning that that that was being looked at and how much money we were actually spending on repairing roads and I was wondering if at some point we could get a figure on that actual amount um okay next I noticed the the sidewalk funding has gone down and my question is is that because there was bond funding for the sidewalk so are we are we just kind of moving it from one area to another I mean it didn't go down significantly but I'm just wondering if you can explain why on the sidewalk funding yes some of that is also with the bonds because we've been focusing on those we had some in the last bond package and it's also because we weren't hitting that number where we were at with with it so we transfer that over into the the other where we could work on some roads and that but we are looking at a holistic plan of making sure that we can hit some more sidewalks and everything else working with the traffic department and bike pet coordinator we get that position and who's taking that over okay and my last question is I know this council or a previous council made a decision to add money to the streets from the general fund every year is that something we are doing are we still accounting for that in the budget or have we changed that I would say that there was there was an attempt to continue pouring additional dollars from the franchise fees into the street fund state didn't help us last year as you recall and with some of their decisions in that that significantly stalled back I think last year we took a five or six hundred thousand dollar hit what we've done is continued taking as much some of the dollars that we've had throughout the city budget to restore that we're drawing down fund balances and we're transferring everything we possibly can over into the street funds that are one-time money you know that we that we feel comfortable doing and at this point but that's how we've had to deal with it there's probably a larger policy discussion down the road this year wasn't the year to have it trying to control the property tax levy and and just kind of deal get caught up one of the other things I would add and it goes back to a question that councilmember Meltzer asked that they're doing it which is a bit a little bit different is they're trying to get out and design sidewalks roads a year or two in advance which means that they're able to get that money invested immediately and and that and start catching up on that that oci number and work on those poor to fair to poor streets the other the other question the council might remember the way we built the bond package last year the election was around the the poor streets so we've got the maps to show you you know we weren't able to knock all of them all of the bare streets out but most of the poor streets were knocked out and that is how the bond package was put together so we should be able to get that for you and remind you of of how that plan was built a year ago but the streets have been I will just tell council that it's been our top priority in terms of getting this where our budget dollars are going okay councilmember Armitage and councilmember Davis thank you so two questions one I want to go back to something that you said earlier that I think is really important and that is about the impact of construction you had you know because we do we tend to think of damage to roads being done just by ordinary cars you know driving over them but there is also you know industrial activity on the roads and then also around the road so I was wondering if you could speak to the impact of that and how you factor in and how impact fees are factored in to budgeting for streets and budgeting needs for streets in your sense of a need for change in impact fees to cover more of that so that it's not covered entirely by taxpayers I think that's a policy discussion for another time at this point right right now the impact fees they're just not a substantial funding portion of our street program they're mostly being that money's generally being used to to wide do off-site improvements for new developments that sort of thing but they're they aggregate slowly and one of the things that has taught us this continues to remind you is construction pricing on these on these roads inflation is just skyrocketing it's not keeping up I think so what we're trying to do is try to stem the degradation of those streets with some of these other strategies with those middle those streets that are more in that 45 to 65 scoring area that has a much bigger impact than impact fees does right now as well as just sort of aggregating dollars and in combining with bond dollars but the impact fees that's a that's a discussion I think for another day and as far as how much you think that should be used and whether you're comfortable with that there's a methodology you can get behind and thank you for mentioning that and I do agree it's a policy discussion for another day I was just wondering how that is factored in but I I do I like the current approach but you know I hope that when we come back to that discussion that can if you think about that because it's really it can really help to you know mitigate the the cost to the to the taxpayer so my second question is more of a kind of administrative question have there been any new positions added to the department and I guess it's more of a two-part question and can you speak to you mentioned that you know bike and pedestrian coordinator can you speak to you kind of plans to to to to fill that position that position is currently being worked through traffic engineering right now and in the process of getting the job description updated and it'll be recruited in very shortly and in terms of administrative department changes the only thing that we've done on an administrative level is we're moving Rachel Woods position and Rachel from development services over to public works so it's kind of a net in net zero impact on the budget but other than that most of the dollars that you're seeing with the downsizing and staff and their cost savings are going right back into the road program and that's what we've been doing all throughout all throughout the city is where you're seeing those losses of positions first we balance the budget then secondly we go right into the right into those one-time expenses to try to catch up our OCI scores so that that is the strategy of this year's budget thank you thank you so much and so these were all the voluntary separation there has been zero layoffs in the city zero furloughs so it's all voluntary separation or retirements outside of that and thank you so much and I'm so pleased with also how the voluntary separation program has been done really appreciate that thank you councilmember Davis thanks so if I need to take my answer offline or an informal staff report or something like that that's just fine but during the hunter coal conversation we talked about in future years some set asides from property tax revenue out there specifically for streets because we know that's going to be a significant network of streets coming onto our catalog and onto our maintenance schedule in future years so at some point if we could see I know these proformas go out what 24 25 we don't expect significant revenue from that neck of the woods until about that time frame and after so at some point could we see what the plan is for those set asides and how we're going to make use of kind of that cash injection into into our streets program absolutely and my understanding is that hunter may be a little i'm sorry col may be a little ahead of hunter right now and in terms of the development so we're probably going to need to have that conversation the next year or two as we start seeing how they're going to structure things but that you're you're exactly right that policy discussion needs to take place in terms of do we start segregating those dollars to handle future maintenance dollars and and how do we different how do we separate it from the eav that's naturally going to flow through the rest of the city so i will ask david and cassie to start working on some kind of a framework when we have a little bit better understanding of what their timing is if if those projects build out in the way they're anticipated to is that going to help us with the goal that you're talking about earlier councilmember melzer it just sounds like massive amounts of money that have to go into a streets program to really get ahead of the deferred maintenance we've gotten ourselves into so is that is that cash going to help us out as that revenue comes in in future years any of these i guess the simple way to look at this is any new development that comes in has a there's a short-term one to two decade definite benefit on the city until those streets start needing repaired and that if the average home value in the in the city is 250 000 and you start seeing these new subdivisions come on they're talking about you know looking more than a three to four hundred thousand dollar range that net difference above and beyond the average will create the the eav to help catch us up the difference that we have talked about with with hunter and coal was possibly setting aside a sinking fund which is the policy discussion that when those streets start degrading we've got the dollars also to handle that as well because the new eav is it's either going to be divided up between current residents and future but that that or we're going to have to come up with some different split in order to to handle those streets and handle the infrastructure out there that is going to be the policy question is what is the council's need right now it's going to be very easy for a council especially if the revenues continue to get impacted down the road to say you know what we're just going to have all that new eav come in and try to catch up our street program to lessen the impact on on the current taxpayers what inevitably will start happening if that happens though is when the coal and hunter streets start degrading you're just going to be looking at larger and larger bonds in order to keep the community kind of where it's at so that calculation and that formula is going to be very important discussion for this group to have yeah um just a comment i just want us to understand that i think when we talk about the good the very good the oci and all those and i've said this ever since we implemented the oci you're going to have a certain percentage of roads that are always going to be under a certain percentage of the oci right it's just those roads will will rotate uh because i don't think we have uh i first of all i don't think our community has the appetite for the amount of tax funds that would be required so i don't want us to get necessarily bogged down in you know yes we can make improvements in the percentages but we're going to the point is we're doing the work i mean i've been on council for 12 years and from 2007 or eight when the recession started to what 2010 11 12 maybe um nothing happened and not only did nothing happen but we were already behind from previous years so i really just commend uh the councils in the past and this council for really continuing to set a priority for road construction i know we hear from our residents that roads are quote unquote bad and that there's all this construction but that's what happens in a in a fairly large city that's old you if we didn't do that our roads would be terrible so look we've got elm and locusts done we've got dallas drive done we're going to do hickory pretty soon so paul uh councilmember melser i think your observation is a good one and that is you know the roads that are the most heavily trafficked as those get repaired then that perception i think will diminish so i'd really commend the streets group and daniel uh your group for just really continuing to move forward and i believe was it this year last year when we diverted some was it the rate of return it's the rate of return never mind is the rate of return from the utilities that we we did something we increased the rate of return for the utilities i thought that was a franchise fee so never mind that that's off topic but so we all understand there's a lot of work to do but there's been a lot of work that's been done and i think um our management team has done a great job in managing all those different priorities so uh appreciate that and appreciate certainly all the comments that have taken place during at least this discussion i think it's important for the community and important for for management to hear that any other comments or questions all right thank you daniel appreciate it we'll move on and it was that yeah that was the end of the presentation we'll move on to our next presentation okay let's try that again good morning mayor council scott gray director of airports and facilities management i will switch to them oh okay yeah when i heard your voice i thought wait a minute we skipped one but your facilities as well and not just airport there we go so the accomplishments over this last year include a number of items and i and i won't go over each and every one of them but one of the main things that we've worked on is the tma work order system to allow us to better track not only the repairs that are requested but preventative maintenance on all of our facilities so we can sure to keep up with with the preventative maintenance so we don't end up into a repair situation we've completed a number of major projects fleet remodel major roofing as well as some other remodels of some of smaller facilities that completed the vela soccer complex which i think you heard on tuesday from parks as well and we're currently completed the development services center design and it's in construction as we speak and we've implemented the public safety building design efforts which is part of the 2019 bond effort for our future goals one of the major things that we're trying to finish up this year is fire station three and fire station number eight they should be completed here this next fiscal year i think the fire one of the fire stations will be done here in october the other one will be completed in in the january time frame we are working on and we'll complete the the american legion facility and then again some of the other facilities that we're working on as i mentioned including parking lots the tennis remodel some parks roofing buildings that we've got out to bid today that we will be moving forward some of the philosophical changes again i i took over facilities just about the time covid hit so i appreciate staff's efforts to bring me up to speed where we're at and a couple of philosophical changes we've made is obviously vsp staff reductions have had some impacts for our our department and we have reorganized a little bit in that area we're enhancing some of our use of outside service contracts again we're going to expand the use of the the tma software but one of the big things in a change this year is cip cip specific priority requests and we'll see that when we get to those slides from a service level change standpoint is is everybody's probably pointed out pre-covid we were moving forward doing doing what we do in each of our departments our management structure was there normal office hours and so forth obviously post-covid with with vsp's we had to do some restructuring our maintenance team has been certainly assisting in in some of our covid responses relevant to cleaning and construction of of shields and so forth at various facilities and most of our admin and project staff has been working remotely here's a depiction of our fte's from current fiscal year vacancies that occurred and then some approved refills so you can see we're at about 20.5 for this current fiscal year we are down five to 16 total you can see the list of the positions that were vacated and we do have approval to fill the the other two the supervisor has been filled and the and actually the facilities tech foreman will be a hvac technician and that's on the street today quick depiction of of facilities divisions as the council may remember this current fiscal year facilities budget is is under a different structure that it's under a reimbursable type of structure so it was separated out it was one hbu it's now three including admin maintenance and projects and you can see that it's separated there and then i'll get into what that means in the actual budget cycle so as i mentioned we're on a reimbursable type of system now and that what that means is based on the square footage of the buildings that are used throughout the city those are charged back to each of the the different funds you can see all the specific funds there and then general fund obviously being the largest to cover all the general fund services you can see we have a slight increase in the revenues and i'll get into the reason for that here on the next slide which is our expenses i draw your attention to the personnel line is we had a obviously a significant drop there of nearly a half a million dollars relevant to some of our restructuring but some of the other items there you'll see that there's actually some increases so that's why we have a little bit higher although modest increase from the current budget to next year's budget that's that's because we're bringing on new facilities the new fire station development services so forth so we'll have some maintenance expense cleaning expenses and so forth that have been added to the budget to facilitate those buildings here's a breakout of of the capital improvement request this year and again i think to draw the attention to the council under the current fiscal year and previous fiscal years i believe there was a 1.5 million dollar bundled approach to flooring hvac and roofing kind of a flat number try to fix as much as we could within that number the philosophy that we're moving forward now is actually getting a strong handle on all of the maintenance requirements for our buildings whether it's lifecycle replacement or whether it's pm and identify those priority projects so we we can stay in front of the curve if you will on the replacements of roofing flooring and so forth so we don't we don't end up letting the buildings deteriorate too far so what we've done this year is we've identified specific projects and and i can show those if the council desires in those areas that are identified whether they're funded through utility funds if it's a building for for those entities or if it's general fund related it just turns out that we're at about total of of 1.8 million dollars 1.4 of that would be through the general fund the current fiscal year is part of the covid response we did have 1.5 million dollars allocated but that money was reverted back to address you know citywide issues so we do not have this current fiscal years funding in place so we will be catching up with this on this particular budget a couple other items i want to point out is the building ada there was a ada assessment done a number of years ago that identified a very various things in various buildings that needed to be addressed unfortunately it appears that that study is somewhat outdated with some of the changes in the ada requirements we are requesting to do a an assessment of all the city buildings to bring that up to date and then have some funding to address some of the immediate needs that are identified in that we are going to be working with engineering with when they fill the position with the ada coordinator to see if we can team up and have some assistance in this area as well to keep up with the ada requirements throughout the city as well the other the other item you'll see there is the covid-19 that's the crf funds that that finances is talk to you about numerous times we've identified approximately 900 000 worth of facility improvements most of those are are regarding hvac purification efforts with the with the hvac system and then the touch free improvements doors and restroom facilities drinking fountains things of that nature that will be changing over the existing equipment into touch free we did have as i mentioned the increase in some of the facility needs and these are the supplementals that were for those add-on buildings showing approximately 219 000 the line that says subsequent ongoing that actually we're hopeful that that is approximately 185 000 moving forward because we won't we won't need the covid cleaning when this is done and over with we hope in this next budget cycle but just in case we've we've allocated what we've expended to date and kind of projected that through next fiscal year if necessary and that is the end and i'd be happy to answer any questions on the facilities council member armature uh yeah so first of all i i want to say that i really appreciate um the the effort that's been made uh to um do hvac updates and cleaning for covid and uh it's you know i i think that we don't it's something that i feel we have to do and i know that that others do too but um i i just think it's a model and i wish that that everybody could do that uh i will uh oh sorry am i still here something happened to my yes we can hear you okay good okay sorry an alarm an alarm just went off um so but um my question is what uh what buildings uh have you found the the the greatest um hvac update needs in terms of you know air filtration under covid certainly we we're actually looking at all um public buildings um to address that we're going to start with um our main building city hall city hall east um those two items actually are going in today um for funding and we'll be ordering that and that that work should be done here within the next four weeks um to have the hvac work done at the same time we'll be looking at doing some of the touch free improvements okay thank you and is there any speaking of ada when when that is prioritized is there any consideration of of those buildings um the the number of uh employees who were there who have to who have to work in those buildings you can't work from home who are immune compromised or just the number in general reference to ada we'll be doing we'll be doing an assessment of all the buildings to see what any ada deficiencies there are and then prioritizing those to address them obviously we'll be we'll be working on our priority buildings that that the general public will be accessing and the staff obviously we have a number of staff that will not be um in the buildings as much so we want to make sure we we do address as many as the ada issues as we can as as timely as we can and thank you so much and i hope this will probably be the case anyway but that you know priority will be given to those buildings that you know not only in terms of the need of that building but also the you know how populated that building is yes ma'am thanks councilmember breaks thank you my question kind of is a little bit similar in that i'm curious on the new buildings and um on the on the ones that we are looking to construct are these the things with the hvac the filters the no touch will those be um required or just givens going forward from this point yes ma'am and i and i failed to mention that the the dsd building the remodel for for police and the new police facilities um they are all including uh those types of of improvements as part of the construction okay and i know that we still have some under construction like fire stations i just um we're we're just considering all all buildings and um at this point right yes and that will take care of with code covid funding cares funding my question about the supplemental packages there's the covid-19 cleaning and the janitorial increase which i don't know maybe about the covid are are those not expenses that we can apply for funding from the cares the covid expenses we certainly can we've been coordinating with um with uh finance on some of those as well um the janitorial number is relevant to just general cleaning and maintenance of the buildings um that are coming online covid would be covid response specific that we would have with our um outside contractor okay so that's just extra cleaning um that's not in the janitorial increase okay thank you any other questions all right we'll move on to the next presentation and mayor you will have me once again yes since i threw you a curve on having to do facilities this year you weren't ready for me so here we are with airport uh obviously one of the the biggest accomplishments in at the airport was the completion of the west parallel runway which i i think everybody's very familiar with and i did just want to mention that the addition of that runway already um has enhanced the safety at the airport tremendously it has been used since day one um and our operations have actually increased um as a result of having it there which is um which is what it was for to separate the traffic and and help with uh with safety a number of other things um that we have listed there uh card access improvements uh budget reductions um the other significant item that if council remember is the uh is the passage of the airport regulatory rewrite documents that is in place and we are in the process of of implementing many of those uh provisions uh today um we have uh added our airfield and inspection software that we're using that was in preparation for part 139 which i'll get into in a minute it's also a part of our future goals which is our lease management we'll have most of that in place here probably before the end of this fiscal year certainly by the end of the year it'll be fully implemented and then as council remembers on tuesday night you did address the design and rehab of the primary runway that paperwork has been submitted to tex dot and we'll be working with them to get the primary runway um rehabilitated and we'll be doing another consultant selection through text dot as part of that and one of the other items that we'll be um really looking forward to is a multi-year pavement maintenance program um to um similar to what you just heard from streets we have the same issues at at the airport where we need to do pavement maintenance for all of our uh taxiways aprons and so forth so we'll be creating a program for that um i'm sorry your camera's off billy's telling me to turn the camera on okay it looks like my camera's off for some reason maybe stop presenting for a second let's see here yeah i think go down there and start video okay start about that let's try that again okay um philosophical changes um as you recall i was the airport manager i moved into a new role um we have vacated the manager position and we are reorganizing um with the staff that we have remaining we have delayed part 139 certification i believe uh chief hedges have mentioned this during his presentation as well um mainly um as a result of training requirements maybe some capital improvements um that will be necessary in a cost savings measure we don't think it'll have a significant impact on the direction the airport was going but we'll certainly be analyzing that throughout this budget cycle to bring that back next year um we have been sharing some of our staff with other departments to help with efficiencies and reduce costs throughout the city mainly in our maintenance area and as long as well as the budget reductions and so forth and we'll spend a lot of time here i think you've heard this from many folks uh pre-covid um you know certainly things were moving along as is what was normal then uh terminal building was open staff was on site we had 24-hour on-call services and maintenance and operations available seven days a week uh post-covid is is the council may recall uh terminal building closed shortly thereafter is still remains closed we have now implemented some curbside service if necessary for folks to drop off paperwork to meet their uh their regulatory requirements we do have most of our admin related staff working remotely do do return on site as necessary but we do significantly make sure we address safety is our operation staff is still remaining at the airport seven days a week to respond to safety and security issues our fte summary as i mentioned the airport manager position is the only reduction we had and that will not be refilled quick picture of our organizational chart rather small unit that we have the the two positions that we have there below the director those are the two positions that will be reorganized and we'll be taking on more of the day-to-day activities moving forward as i will be spending more of my time with facilities and so forth so here's here's probably the the most important slide is the uh the five-year fund at the airport and i want to draw the council's attention to a couple of items is the the fuel flowage fee line item and the fbo hanger tie-down commissions on the revenue side at the top as you can see there's a 20 30 drop there based on covid mainly the impacts was relevant to business aviation reductions during covid as you can imagine so we've had that reduction we are showing that that we will start coming out of that in this next fiscal year but i can tell you that is very conservative reports out of the national business aviation association are showing a strong increase in business aviation across the country already so i would expect that we will start to see that turn around sooner than later but for conservative purposes we did want to look at what we haven't projected for the next several months we did have some reductions in the in the personnel area as i mentioned and we did some various other reductions but probably one of the significant changes this year and i know that this has been discussed every every year since i've been here is the debt service and as you can see now the debt service is included under the expenses of the airport and we will be drawing down our fund balance to assist in in in that debt service payment so as you can see down towards the bottom it will still leave us a fund balance of nearly a million dollars you know for five years now again we will continue to review this with finance every year we'll bring that forward and see where we're at and and certainly we're doing it now and to assist the city-wide efforts and cost reductions for the general fund quickly on on cip for the airport every year we do the text dot ramp grant which is a 50-50 grant 50 000 from the city 50 000 from text dot to do just general minor maintenance stuff around the airfield we we fulfill that every year the one thing that's going on right now is the west side parallel runway lighting project actually start construction here in the next several weeks that 165 000 was already paid and and that project is underway one of the things that the council acted on on tuesday was the primary runway rehabilitation project the design care zack funds through the faa to the state actually is covering our 40 000 match for that project so we have a zero match for that and then there's two other projects relevant to the primary runway a full depth repair project that was already designed and then the full rehab of the rest of the runway as you can see the asterisk there for the fiscal year that we're talking about the 358 000 we actually had significant savings in the west parallel runway construction that we will have a refund from text dot that will likely cover that match and not have to incur any additional debt service and then as is i i added on next year's which is the nearly 500 000 necessary for the match for the construction for the runway primary runway rehab and we'll be bringing that back to to council when when we get that from text dot that is it so i'd be happy to answer any questions mayor sure any questions i've got one but wanted to check on my colleagues first scott on the uh because the debt service has been sort of an interesting um ping pong ball so to speak it's been in the budget airport budget it's not been in the budget now it's back in the budget and when you look at the outlying years the forecast you can see it's not going to take very long to eventually deplete that fund balance i mean the next year after the forecast i mean it's not on the chart if everything goes that way it's going to be down to about two so in two years it'll it'll be depleted or one and a half years what what is the um what's the philosophy moving forward uh i mean the airport i believe is an enterprise fund is that correct that's correct so what's the philosophy moving forward because whether we include it in the budget or not the general fund will is still going to be i mean putting it in the budget was the was the purpose to draw down those funds uh or is the city eventually going to have to have we're going to have a line item in the budget where it says a transfer from the general fund i mean what are we what's what was the strategy for doing that uh number one transparency sake just to make it okay this is associated with the airport it should be in the budget but moving forward what's the what's the plan to fund that debt service when our expenses exceed our revenues and we don't have the general and we don't have the fund balance certainly let me let me start and then and david might be able to fill in the blanks as well um certainly you can see that we're drawing down the funds we had a three point five million dollar fund balance um that we felt it was necessary to um help the city throughout by addressing our own debt services as long as we can one of the things that we do not see in there is the potential for expanded leases on the west side as you recall we have a hundred or so acres on the west side that we might be able to move into sooner than later obviously if we get road access to that side that may help bring in additional revenues to start offsetting some of those expenses so i think right now it does look like we will deplete that fund balance over the next five years but i think in the next five years we also have the opportunity to explore expansion on the west side of the facility especially if we can get access that will help us address a longer term goal of being financially self-sufficient at the airport so i appreciate that if and either you or david could i'm looking at the slide of your five-year is that a five-year forecast five-year forecast and um when we and since we've included the debt service when we didn't include the debt service the revenues were really close to the expenses like the year before when you look at that and of course gas royalties are going down i guess my only response to your your observation is that right now if we without the debt service in the budget last year operations and expenses revenues and expenses were about even with that additional $300,000 approximately of gas well revenue so when i look at an expansion on the west side of course we're going to have infrastructure improvements that are going to require capital outlays which will be debt service and then we'll have of course the opportunity to lease that land but when you look at what we're experiencing right now if even if we had no debt we're still making even but that's with about $300,000 a year in gas well revenue so i guess the goal is to continue to try to make it more self-sufficient in the sense of our expenses and our and our revenue match up without any type of general fund subsidy that is correct one of our one of our fa grant assurances has tried to be as self-sufficient as possible but certainly that's my goal is to continue analyzing revenue opportunities to increase our revenue to help offset diminishing gas wells and then and certainly assist in our debt service okay what is the debt what's the debt we have out there what's the balance of that i just off the top anybody know i do not have that number okay all right well we can get that later yeah that that answers my question i don't david i don't think i need david to step in i just was curious as to what the plan was but it sounds like we've got enough to where if all of a sudden the the we've just got to figure out how to make up that 700 or 600 something thousand dollars a year get that in additional revenue to sort of even that out that's correct okay all right any other questions on the airport presentation council member briggs just a comment that i appreciate that debt service being shown in here um i know that it hadn't been i think mayor you brought it up before so i appreciate that that it's here it's um it gives us a better idea of what's happening and i also just want to say that you know we have a really great economic development board as well and i know that airport is part of that and so as we talk about the future and expanding and you know how we're going to start making money out of the airport i hope that we bring that into the conversation certainly we we work very closely with economic development department and we do periodic updates to the edp board as well so scott real quickly on the land leases in this particular slide are those based upon development on the west side or is that still just the development opportunities that still exist currently it's just on the east side the west side has not been included because without without adequate access planned for that side we do not want to expect that we will be able to generate revenue on that side until we until we know that we can get customers over there okay so it would be cpi increases and then we have we have a number of acres still remaining on the east side i think about seven acres um half of that i think will be gone here shortly to help us out but that's just on the east side okay all right fantastic any other questions let's we've been going at it about an hour and a half let's take about a five or ten minute break and we'll come back thank you scott appreciate it yes sir welcome back to this meeting of the denton city council special call meeting on thursday june the 30th 2020 it is 10 14 but we only have one section one work session report and it is we're going over departmental budgets for the fiscal year 2020 through 2021 we are now with exhibit five which is community services uh budget presentation so we'll move forward with that morning mayor danny shaw community services manager doing a combined presentation uh for community improvement services and community development today i just want to go through a few of our accomplishments and with code enforcement we've have uh created some efficiencies with new technology to allow them to work a little bit easier in the field adding field tablets and cell phones and then we're working through our processes and organizational structure which as a result of some changes in staffing that have been successfully implemented with community development of course this was the year to complete our consolidated plan and our action plan so we had to complete that and council approved that july 21st we've also been working with our partners to implement a new shelter model the enhanced shelter model and we hired a consultant to implement a phase one of an affordable housing assessment which is almost complete our future goals of course are to look at a code review and make it a little bit more efficient for our for our residents community development will be working on the loop 288 facility as we work through that process of getting that project online and then once we've completed the affordable housing assessment we'll be looking at what the next steps are for that overall with community services we are looking at other performance improvements and process improvements and program enhancements that are available to us as a result of the merger so as you remember in january community services was created to combine community development and community improvement services both both divisions were working on making sure that we had safe family friendly communities and so this was a natural a natural step to help us work more towards that enhancement of making more resilient communities and working on neighborhood building both both of those divisions were doing that work very well and it also helped us with looking at where we can identify some efficiencies reduce some duplications in the work that was being done implement some restructure opportunities of course that was the impetus for the merger in the beginning but also to build some learning opportunities based on what each group was learning in the field and then our work is significantly impacted by our relationship to the other divisions and so working on coordinating and increasing that coordination among those is a priority for us as well we did experience some service level changes as a result of coven as you know with the the implementation of some of the measures we took our first step with with our code enforcement officers was to make sure that we modified that so that we were assisting with residents in need who might be impacted by coven as a march 25th we took a significant step in putting folks who were in the shelter and reduce their risk of contracting coven by putting them into hotels and so our staff were very instrumental in making that process and that transition happened with the with the agencies as well as supporting other nonprofit agencies as we were adapting to the coven pandemic response in addition staff had taken on some additional responsibilities based on both direction from council and disaster enforcement as well as just the results of putting those folks in the hotels and some of the necessary steps that needed to be taken so for example code enforcement took on the enforcement of the ordinances of council put in place as well as for the month of april may and june they were responsible for the daily delivery of three meals to the hotels for the folks who were there and they did a great job implementing that there was fewer impacts to community development we just have a larger i mean a smaller set of folks that were serving on a daily basis so those improvements and those processes that were put in place that you're aware of from scheduling appointments and making sure we're social distancing with clients who are coming in for improvement or assistance we were able to do those relatively easily in june we also did have some folks who took advantage of the vsp and i'll talk about that in a second so a little bit of information about how we're looking at performance currently just wanted to reflect the community development benefits from not just the general fund but also leveraging federal funds to help us with the services we provide to the community and some of those goals that we're looking for in those program areas that you should be familiar with with our consolidated plan with community improvement services the caseload is down a little bit as we would expect we were opening less cases just making sure we were monitoring for those that those issues that were severe and for public health and safety but otherwise just maintaining neighborhood enforcement i did put some data in here about um where our largest cases are just as an interesting data point grass and weeds makes up 34 of our cases and trash 32 some other data for them their average number of days to resolution is 12.4 they're able to address most complaints within 48 hours and then just some data that we're watching as far as complaint driven and proactive we are seeing a slight shift that we're serving more complaint driven rather than proactive that's that's changing over time and then the rest of the slide really just a reinforcement of what i talked about earlier as far as the additional duties that were taken on by the division as a result of the covid response um sorry the this is a summary of our positions as you can see a couple things to highlight here three of our positions are funded out of the federal grants and not the general fund we started the year the fiscal year with 18 are now down to 13 and that's a result of a couple of things we did have an early resignation before we merged and then a couple of officers took promotions in other parts of the city we did have two staff who took advantage of the vsp and then at the time that we merged we had created a new position and that is the position that we retained and was approved for a refill the assistant community services manager which we just filled so as we look at the budget later you'll see our significant savings have been in personnel costs oops this is the organizational chart created to kind of reflect how our division truly operates there's a lot of relationship and overlap in what the folks are doing so it's a bit more of a team structure rather than a top down it's also hoping to demonstrate what our future vision is for this division in our work making sure we're serving the community and the services we offer this is a review of our budget as as i mentioned earlier our personnel costs are the the most significant reduction in our budget about 450 000 reduction there we did we're able to save some money as well this during this year just on the materials and supplies so we're some cost savings there too so our preliminary budget is 2.7 million a couple of asterisks to highlight in our miscellaneous we're also going to see some savings here just in the lower expenditures in some of our grant programs for example for example the development fee grant we won't expend that full allocation this year just a couple bullet points we certainly we're not seeing any changes overall in the community development budget the human service advisory committee this is a standard increase usually based on per capita so there's a slight increase of eight thousand dollars in the fund for that human services grant that was recommended and then for the 2021 fiscal year we'll be receiving 1.6 million of cdbg and cdbgcv funds as well as 505 000 in home funds all of that was included in our consolidated planning process as well and then just as a quick reminder our personnel budget doesn't include the grant funded positions so with that i'll open it up for questions questions councilmember briggs thank you danny my my question is about the um the community improvement uh positions it looks like it's almost half are gone and i was curious if with the level of um requests that that we're having and the more responsibilities the council's asking of that department with um enforcement and calls engage denton um and then also just other things is is that a concern and not a concern we're still in the process of evaluating what the overall resident need is in that area i think we're in a place where we're right size from the manager supervisor level we've made those improvements there so now it's just looking at what the demand is from the residents and seeing what the need is i think for now we're where we are but we are working towards process improvement so we'll be doing a significant amount of analysis on what the demand is and what the resident needs are and that's that's the next part of our process for the future goals okay and on the on the vacant positions it's a specialty cis officer is that is that was that the it wasn't the rental um inspections person was it no ma'am we had six different or we have three different classifications for the cis officers there's a cis officer specialty and senior officer so we had two of each at the time that i took over one of the specialty officers took the vsp but our two senior officers the one who does the rental inspection program is still with us okay um i noticed there wasn't any data on that on um calls or inspections so i'm just wondering if at some point we can follow up absolutely that is that is my one of my primary goals is we're working through getting the data collection part right the the coding the coding in our traget system was a little unique and so pulling data out of it has been a little bit of a challenge so we're working through getting those classes accurate so that we can pull data better so absolutely we'll share that with you as soon as we have it thank you that's my barometer yeah so thank you so first i want to commend um you know this is uh one part of the new reorganization that i really like i'm really glad that that that um that that you danny are are overseeing all of this uh and i'm actually i'm really pleased with the reduction at least this is what what i'm calling the reduction in uh the uh community improvement side of things aka code enforcement i still call it code enforcement um and uh i think that uh you know the fact that and did i get this right that that uh that 34 percent of coding of the code enforcement requests are grass and weeds yeah especially this time of year it's just a significant um significant whether it's um our our officers noticing large um grass and weeds or complaint driven from neighbors yeah and thank you yeah and and complaint driven and so from you know for me personally as an individual council member you know grass and weed overgrowth is so far down on my list of priorities compared to the other kinds of needs that um that the community development side of of this department serves and so at a time like this i i do think that it's critical that we look at where are we addressing public safety um and you know and where is you know this a matter of you know aesthetic concerns that we can kind of put aside um council member armor council member armature i think that's a policy question we're venturing oh no no no absolutely yeah absolutely i'm just but i will every once in a while kind of make it just kind of state a um a a policy yeah related um but anyway but i really like this part of the restructuring i'm very pleased i'm not saying that it's moving towards that policy direction but i just wanted people to know um so uh i was wondering can you speak to as far as the community development side which you know in my opinion this is the the department that deals with what i consider to be our city's biggest biggest needs um which i also consider to be the department and denton is not unique in this but community development departments are like this it is one department in cities where um we're not uh fully meeting our needs and i would love to see that um to be the be the goal so can you speak to you know what percentage of the need in this department in these in this area that you've assessed is met and also what percentage is being addressed by federal funds versus city city funds general funds well it varies by project so i'll just the second part of your question first and with with larger scale projects the really the federal funds are helping out with those those higher cost items construction of homes um infrastructure projects those kind of things but with public services actually that's um more heavily funded by the general fund than the federal funds our general fund provides a little bit more flexibility and then there are limitations on the federal funds so for that for that reason that's how we balance that as far as the overall community needs we we did include a lot of that information in the consolidated plan and how we're addressing those and we are addressing those significantly with the resources that we have certainly there's more need and demand than there are resources in the community not just from the city's perspective but with our local nonprofits so those are going to be a non-going challenge for every community including ours thank you for addressing that and then one and then finally uh and this is also related to council member briggs's question you know so i i appreciated how you had that slide showing the concentric circles of the overlap uh with that overlap in the middle in these departments um you know and uh for me is one thing that the covet has really highlighted is uh tenants needs and so i would i would also be curious to to see um you know not only the number of requests for uh interior rental inspections which for people who are not who are listening some a lot of people still don't know that we do that it's limited in what it can do and a lot of people don't know that there's one guy who does it uh and um but i i would be curious to know you know are we meeting that need and hopefully the answer is yes but maybe it's so anyway i would be interested to know that um i'm wondering if you could speak to if there are plans to uh you know exploit that that connection more uh between uh the community development side of tenants needs and the um the community improvement yeah absolutely i think one of the benefits of bringing us together was exactly that is to be able to look at the data and see the resources available will also benefit from the affordable housing assessment from the phase one information that's being provided to us to help us at least get a better view of what the resources are needed and what gaps are in the community and then then we can work on a plan on how to address those for what the city can do and how we can support the community to to address the other issues thank you thank you so much any other questions all right thank you danny appreciate it mayor and council this is jennifer becker director of libraries i'm here to talk about the library's budget presentation so our accomplishments for this last year are thanks to your support and approval we were able to eliminate overdue fines for returned materials which we are very excited about um prior to covid um changes uh there was an average of 12 increase in circulation in library materials and we we attribute that to that um elimination of overdue fines people weren't afraid to return overdue materials so we were getting them back and people were more comfortable checking out more materials because they weren't afraid of accruing those overdue charges we included 30 mobile wi-fi hotspots those are perpetually checked out as of yesterday there was not a hold list which is great so people aren't waiting for those but they are all checked out there's been 126 circulations of those mobile wi-fi hotspots since they were introduced on march 1st we just kicked off our books to go student account partnership with denton isd which is basically making our existing uh youth courtesy card account integrated with the denton isd registration process to make it easier for families to get their students access to the denton public library materials and resources parents can opt into that program um students can use their student id to check out materials and access the online resources and use library computers we added some cameras to library facilities and we are in the midst of a collection rebalancing project at an emily fowler central library rearrangement we are hoping to get all of that completed so that when the library does open its doors for walk-in service again people will be wowed at the changes there our future goals for next year are to update our rfid and self-tech self-check technology those include our self-check machines automated return chutes security gates and rfid programming tags um the reading nook park at the emily fowler central library and the groundbreaking has already happened and there's work behind the library to build a beautiful um public gathering area once we aren't social distancing as much um and then we're hoping to secure ongoing funding for the municipal archive project and move and expand the forage maker space to a larger area at the north branch we had several plans for updating our department with our long-term planning however with covid we have made a silver lining out of that situation and we are we have moved forward with a departmental reorganization and moving towards a single point of service model both of these are very limited in that they're going to help us improve customer service and give us better staffing efficiencies and improve communication across the department we've had many service level changes um with covid um when the facility shut down in march the libraries were included with that we immediately pivoted to create a curbside service to keep materials circulating with the public we did have to pause that for a short period of time um during the stay at home orders but we ramped that back up again towards the end of april with curbside pickup we included virtual programming and we were at work the whole time answering the phone and performing email reference readers advisory services and assisting our customers in phase two we started that at the beginning of june where we added to the curbside hold um appointments to use computers in the libraries we recognized that the library is a technology hub for the community and we wanted to make sure that people had access to that technology so we still have appointments for anyone to use our computers at all three branches and we also instituted a virtual book a librarian service we moved for a short period to phase three um for two weeks at north branch however as the covid cases in the city and the county were escalating so quickly we did pull back to phase two again after two weeks um and we're waiting on those numbers to go down before we move back to phase three at north branch again so before covid um we were checking along providing amazing customer service to the public providing resources and technology programming and outreach educational services for all ages we had to pivot um with covid to provide those those same services in a distance methodology so whether it's virtual or providing that curbside at all three locations we wanted to make sure that our technology and resources were still available to the public we have had some changes with our fte's um we went from 49 fte's to 47 we had two existing part-time vacancies before covid uh library assistant two in administration to assist with interlibrary loan and material processing and cataloging and a library assistant one emily feller with the circulation unit there we also had a librarian at south branch we had a librarian take advantage of the vsp program those positions um we we decided with our changes with our reorganization and our moving to a one desk service model we would be able to absorb that loss and so we are moving forward without those fte's and this is our new organization organizational structure we are bringing back one branch manager for each location we also have our technical services manager who manages the entire collection including digital as well as physical resources databases and interlibrary loan so we will have one manager at each location the emily feller central library has an assistant branch manager who oversees the special collections unit which is our genealogy local history municipal archive and texana collections and another assistant branch manager will be overseeing system-wide programming and outreach services as well as helping us with our forge update that person will be overseeing the forge makerspace which we fill is a diamond in the rough and we are going to polish that up in this next year and make it a place you can't live without we have promoted our circulation team leaders to circulation supervisors and they will now directly supervise our library assistance and circulation this is our proposed budget our personnel went down since we lost those fte's we also had a reduction in operations there was an adjustment we got new hvac systems at the south branch library so there's less electricity funding needed for that because they're more efficient otherwise things are pretty stable the transfers to technology services also went up we are a high technology department and ts does a lot of work to keep us going the one ongoing funding request we have been asking for for this year is our for our municipal archive which was a project that was brought to council several years ago and approved we have been able to kick this project off and keep it going with no additional funding we did a reorg with a vacant position to bring in an archivist a certified archivist and we've been absorbing the supply cost as much as we can but it's to a point where we do need some ongoing funding for those archival supplies and archival supplies are not as cheap as office supplies unfortunately so we are asking for a five thousand dollar ongoing increase with that budget item any questions all right council members council member armature and then council member melzer okay so first of all i want to say that how pleased i am with the new restructuring to see that each library now has its own manager am i correct in remembering that under that previously there was a one manager for all of the the libraries or maybe i'm getting the position name wrong we had one manager emily fowler we had the technical services manager and then we had one manager who managed both north and south branch and his focus was branch services the manager emily fowler she not only managed emily fowler but also took on the programming oversight as well as system-wide circulation which is a massive beast yeah yeah and this this is much more efficient to me and i'm just i'm really pleased to see this happening and i just just want to i want to highlight that and also just the fact that even though the budget is tight and so there's a lot of consolidating happening this is an area where it was just not efficient in my opinion you know to do that to to have that former consolidating so we're actually moving to a more efficient model where every where it's uh it's more spread out so i'm really pleased with that um so i wanted to ask so about the archival uh supplement and and by the way i hope that ends up being being funded um uh if for for anyone who wants to who any member of the public wants to help out with that with donating to their you know friends of the libraries can people specify that that money go towards um municipal archives so anybody who wanted to make a monetary donation can contact us and we have a um special collections donation line item and that can be specified for that if anybody has materials that they're interested in donating they would want to contact um the library and we can put them in contact with matt davis he's our archivist because there are certain things that we would be able to accept and certain things we wouldn't but we could absolutely look at those items okay excellent just a few more real quick questions um uh are you all working with the local uh library schools or having you know internships or considering that uh for our archival work we we do work with both tw and unt there are only four certified um uh library or accredited library schools in texas and we have two in this town it's wonderful um and so we do work with both of the universities to get practicum students um there's always an interest for special collections and archives and genealogy and so they usually have one each semester at this time we are not taking them because of covid and we aren't we aren't having people come in but we cannot wait to reopen and bring them back in thank you is there any digital archive work though that can be done or is really kind of hands-on physical archive you have to come in and handle the materials and there is processing and there is scanning involved um however you still do have to come in and handle the materials exactly so thank you and then um uh is there has there been an increase in online subscriptions under covid that is from you know the library subscribing to online online resources so we have um two resources for downloadable materials ebooks audiobooks music streaming tv movies um and the circulation for those has shot through the roof um it's been very popular we have a lot of new users to those services we're very excited to share that with people we encourage them to use it we've reallocated some of our um material funding that was allocated towards print materials to digital just because it's a fast turnaround we order it within 24 hours that item is available for checkout um so we've refocused some of that um we know we still have curbside but so many people like love to browse the shelves and browsing the digital shelves is an opportunity even with our facilities closed so so that has been very popular excellent thank you and one more real quickie um what uh do you have to say about um to uh the isd families who are doing the the online option thinking learn online learning option thinking about how um either a virtual book a librarian service could be used or wi-fi you know what do denton city libraries have uh to to meet with these needs or if you could kind of speak to that your sense of what the need is from what you've been hearing from denton residents so i think our number one thing that we would direct people to do is call us go on our website our top things for students we have homework help which is free online tutoring um it is 3 p.m to 10 p.m for grades three through college so if you are struggling with your student with online um learning and it's getting frustrating that's another great resource it's free for available for students and of course check online we have tons of other resources and if people just give us a call or send us an email we can customize what we have for their specific needs okay uh councilmember melzer did you uh yeah and then councilmember briggs yes yeah just really commenting on preparation i uh had a chat with my uh pointing on the library board and his main observation was that his mind is blown at how much more the library has to offer beyond what you think of and in terms of bound books on shelves that that's a relatively small part of the huge breadth of offerings and i i hope the product that we have is so rich uh and it you know has there's so many elements you know i hope it's kind of policy statement there but that you know we find ways to just make the public more aware as we come out of covet you know what resources are there it's like the word library doesn't really capture it anymore because it makes you think of those stacks of books and it's so much more than that so uh thanks for creating an amazing breadth of offerings thank you councilmember melzer councilmember briggs um so just a few questions um are the hot spots have been checked out and that program is really successful do we have any plans of um trying to get more or any are extra ones in this budget so we had applied for the texas state library and archives commission got funding um as part of the cares grant act and we applied for round one of that to purchase 15 more hot spots as well as get wi-fi in the parking lots we were not awarded in round one but we will be reapplying in round two once they announce those dates um so we would like to expand that um at this time we don't really have that in our budget but we we we do plan to reapply for that grant um how much how much was that grant for that that you're applying for we were asking for it wasn't too much um and that but that did include the parking lot hot um wi-fi access and i want to say it was about 15 000 less than 20 okay well that's helpful um and on the disd cards which i think are fantastic that that's integrated into the system my question is and i know that i've had other people ask me is that just for city of denton students within disd or is that all no matter what city okay so they all get access to um the library yes we've always had the youth courtesy card because so many uh dentin isd families live just across the street from the city border and a child doesn't choose where a parent lives so we integrated that youth courtesy card as part of our process we've had that for years um but so many people don't know about it and we try to share it as much as possible but we thought this is a great partnership where we can just go ahead and make it even easier for families to find so it's the same exact service it's a limited checkout but they do get access to all of the online resources three items at a time and they can use the computers and if they go through the dentin isd books to go program their student id is their library card which is even easier um there's nothing extra to lose because um students are really good about keeping their student ids with them they memorize their number but i know an extra library card could easily be lost so we wanted to make that part of the program okay well that that helped settle it um last question i i um had spoken to someone who went to a library and they were able to check out a backpack with binoculars field guides and a state parks pass um and it was it was pretty exciting for the family to be able to do that is that within our material budget um to create something like that so we have something similar called discovery kits and we have them for kids teens and adults and their hands-on activities we don't have any with passes to museums or state parks though but we've got everything from you can get a keyboard a giant electric keyboard sewing machine to um hands-on science kits um if you search in the catalog for discovery kits those will all come up okay thank you any other questions yeah i would like to let councilman i've heard this theme a couple times like regarding disd and is we're getting a school kickoff i've been having conversations with superintendent wilson um regarding some possible technology grants that he's going after as well so we've offered our assistance to him and anything that he needs from us in order to make that process more competitive so we're not going to solve their needs right now through hot spots or other technology needs right now but i think he's got potential of accessing quite a bit of money and is probably going to need some assistance and support from both the county and the city so we both told him that anything he needs we will be on board to help him you know get that get that support okay all right thank you any other questions comments all right we'll move on to the next presentation which is economic development so morning so good morning mayor and council members joseph rogers director of economic development please switch on the share screen and it's not working sorry the slides are not advancing when i share there we go now we go sorry probably just a user error right so moving quickly to our accomplishments and future goals i just want to highlight two on this slide and our department has really had two central priorities over the last four months one being providing ongoing support to businesses throughout the covid pandemic and i can i'll hit on that in a few slides of what that has meant in terms of volume for our office and then our other priority has been continuing our work on our almost completed strategic plan so i only mentioned those two things to say that i think they will both be coming back to you in a number of ways over the next month and so i want to emphasize that those are the two items that are really driving our future goals which are implementation of the new strategic plan but also working with businesses to help them recover and stabilize throughout the covid pandemic since we don't really know how long it's going to impact and what the long-term impacts will be on our community so moving forward to philosophical changes as i mentioned our department saw a really critical and major shift in how we had to do business over the past four months we reprioritized staff to focusing on finding resources helping businesses connect with those resources and stabilize the local economy in every method that we can we did all of that while still wanting to focus on our primary efforts which include recruiting new businesses and retaining and expanding current businesses and i will say that that activity has continued and and we've had to balance our new efforts along with that but also we're continuing to work on what we need to do in terms of workforce development and any rescaling that needs to be done in our workforce and also working to really continue to foster denton's culture and our unique entertainment and creative spaces that draw people to denton in terms of service level changes the timeline that you see there for us is really about opening and stay at home orders and business closures because those have been our really milestones of how we've had to operate since late march so prior to covid we were business as usual working on our strategic plan and some other key studies and really starting to lay the groundwork for what efforts were we going to put forward in the next fiscal year on our functional and foundational areas of recruitment retention and expansion post covid i can tell you our priorities have shifted our first and foremost priority is providing guidance to businesses city leaders other agencies in regards to the federal state and private programs that are available i myself have gotten to read about 2 000 pages of federal programming and different legislative actions at the federal and state level things like the economic disaster excuse me the economic impact disaster loans the ppp's that i've talked to you about many times as well as working with the texas workforce commission and workforce solutions on north central texas regarding unemployment and the changes to the unemployment insurance program and making sure that our employers know how to access those resources and how to ensure that their employees have access to those resources we've also increased our contacts and outreach to our most impacted business sectors hospitality restaurants our downtown businesses our creative spaces making sure that either directly through our office or through our partners like main street or the chamber that they have a touch point that they have a place to go to if they have questions a lot of these programs are incredibly complex and challenging and i don't know how many business owners have time to read the internal revenue code but certainly getting them access to people that that know how those programs operate and how to take advantage of those and then also focusing on researching and staying up to date with what do businesses need and going to them directly and asking them what do you need and what questions do you have and how can we help you so what does that look like in our data so i picked two of our most compelling data points to share with you one is our business active assistance activities this is what we consider our technical and advisory support role this is when a business an existing business contacts us directly with a question about a process or program they're not sure how to take advantage of that we typically average about a hundred of those touches a quarter they might happen via phone via email an in-person visit over the second and third quarter we actually had over 200 in each of those quarters we're well over 600 at this point in the year which far exceeds any any year in the recent past in terms of those touch points and then as our business retention visits we definitely had a shift we weren't going to businesses so i changed that to save visits and contacts but we made over 80 proactive calls to businesses in the third and fourth quarter and i apologize that the fourth quarter bar isn't up there but we've made over 80 proactive calls to our major employers our targeted sectors and some of our again highly impacted businesses such as restaurants and directly reaching out to them and saying what can we do for you how is this impacting you and what can we do to get you resources that you need our fte summary isn't that different than it's been before we previously had 5.75 fte's we currently have three vacancies so our existing staff is really doing double duty a lot right now we've been approved to refill two of those positions we have one of those positions that's moving forward with the interview phase within the next week or so and so hopefully we'll have one of those positions filled within this fiscal year and then our goal with the economic excuse me and that's the business development administrator position many of you know michelle cunningham she retired and we miss her greatly but she spent 23 years with us here in denton and so we wish her the best and then the other position that we have is our economic development analyst position and we intend to get some other strategic things in in place before we move forward with hiring that position and really analyze our needs in the next next fiscal year before we move forward so this is our very simple updated org chart as i mentioned the analysts and the business development administrator are the two vacant positions in terms of our budget we look pretty similar to what we have had in the past some slight reductions in salaries due to the vsp and not refilling one position we've also re-examined some of our software and programming costs and that's the reduction you see in the operations line and then also you'll see a reduction in the chapter 380 agreements those are actually funded out of our budget and i'll go over those in a little more detail in the next slide so in terms of our incentive forecast so our chapter 380 agreements that are funded out of the economic development budget we're holding steady on our property tax agreements and that's because we as i think david presented to you earlier we are waiting to get the certified values for those properties before we make the final forecast so we've held them at the level they were at in the previous year um really trying to be super conservative on on that on the sales tax side what you see there and that reduction is that a number of our retailers that have the existing chapter 380 agreements were severely impacted in in april and may uh due to the covid pandemic so we're monitoring those very closely and we're in contact with all of them um but certainly you've seen that on the revenue side and and this is how it affects the expenditure side as well so any of those grantees that have had revenue reductions uh we've had to adjust our forecast to match what we're seeing the other budget that we have under economic development is the stoke budget and so this contract does expire in the next fiscal year and so that's the reduction that you see is a decrease from that about 240 000 down to about 208 000 and that is all i have i will answer any questions that you have okay questions uh jessica just real quick uh don't need an answer now but um when will be the next time you will send out sort of a schedule of the incentives and not how much they are but their expiration date because i know some are coming close to rolling off i think the uh and so i didn't know is that just going to be with the budget overall budget presentation is that when when that information will come for we can provide that separately as we have some single-payer um incentives now we have to present them cumulatively um as part of our budget but we we can provide that list to you okay yeah just curious all right any other comments we did have some that rolled off it that are rolling off this fiscal year yes sir okay great thank you all right uh thank you very much appreciate it council member armor did you have a question uh yes yeah one question um i was wondering if if you could speak to um the role of the economic development partnership board in in helping uss you know you mentioned that you've been going out to talking to individual businesses impacted and i so appreciate that um there's such a need for that is how much of that is any of that kind of coming through the economic development partnership board or is it more about directly to individual businesses and if the latter um you know is there any consideration about um just the role uh from a budget perspective the the economic development partnership board and it's it's used for for economic development sure so the data that i provided to you was specific to our operational components so that's something that's handled at the staff level so those business outreach or things that i'm directing the staff or that i'm engaging in personally the economic development partnership board i can tell you multiple members uh got phone calls from me over the past four months seeking their expertise in a certain area um that's the value that they bring to me and getting their feedback on a number of our programs and initiatives and what are they seeing in their businesses that we can use to direct our staff accordingly they weren't meeting during the covid pandemic as many of the boards and commissions were suspended for that first few months they've gotten back together over the past i think two months and have really been working through our strategic planning process and that's where we're we we're hoping that they can provide the most value as being our our stakeholder group being the voices as we're building our strategic plan that staff can go and implement and that will translate in those into those direct metrics that you're seeing on the screen so i hope that answers your question but certainly let me know if it doesn't yeah no thank you so much thank you all right okay thank you jessica appreciate it thank you we'll move on to the next one which i believe is developmental services development services good morning mayor council scott mcdonald director of development services um here just want to talk a little bit about uh our accomplishments and some of our future goals um over the past year we've completed a cost of service analysis and and revised our fee structure to meet council's recovery levels that's gone well we've completed our update to the historic preservation plan and ultimately we've continued to reduce our days of review so just to highlight that we've went from approximately eight days to less than four days for for new reviews and that's also adjusting with the new development code and the changes with covid so we've updated our webpage and created a more user-friendly means to to be connected and connected with our development community in much more of a focused way through a variety of town halls and informational sources to the future we're looking to make some minor amendments to the development code we've used the updated code for approximately a year identified some changes that needed to occur we're working through that uh currently with our with our legal staff and and hope to be bringing that forward uh additionally we've uh are updating our development software to where it is that we have a single platform rather than using two platforms so we have an outdated uh source that we'll be bringing forward over the coming year uh additionally we're uh we're going to be moving to a new location we'll be having a single source for uh denton's delt development services as well as engineering review economic development and truly being a one-stop shop for the city of denton we will uh implement the historic preservation plan that we've updated as well as our criteria and administrative manuals just to briefly talk about what we've done as far as service level changes um pre-covid really we took many applications in person we've gone virtually so we are taking all of those applications uh remotely we're doing it electronically we're doing uh inspections uh where they were always in person as many as we can uh via web conferencing so that's been very effective uh all of our contractor registrations used to be in person we're now doing that um via electronically um all of our application pre-application conferences pre-construction conferences uh were conducted in person we're using teams it's been incredibly effective uh the development community has has commented and and are enjoying it as well so this is it's been a welcome change and truly is going to change how we do business to the future um we have streamlined the submittal process where we were taking uh compact discs and mylar's that we're doing you know vastly most all of that electronically um on all of our our plat cemittals and uh really been able to to minimize that work and then where it is that our administrative staff were focused only on development service activities planning and building inspection um we're expanding that across the city and and truly if we're going to have a one-stop shop um those areas where we can pick up some of the other administrative functions where maybe through vsp or where it makes the most sense to try to minimize um having over overlap or duplication and service delivery just to give you a very brief overview of our operational data um as far as development projects as you can see 1920 um is is fairly comparable to previous years um had a number of projects that have come in in the third quarter of the year um really a spike some of those being resubmittals a number of permits are fairly consistent slightly down um however those revenues uh the scope of the projects are larger or greater value and and again we're seeing that it's fairly consistent with previous years when we talk about our pre-application conferences and pre-construction meetings um we have been fairly consistent in that again our our trends and the interest in denton continues to grow we've had a lot of dialogue over the past couple of weeks with any number of new development opportunities and and we don't necessarily see any slowing in sight as well our as i mentioned before our average review days have continued to decline so we're being more efficient and effective in how it is that we review these projects and bring the best light on on denton and our community to develop in to talk briefly on our fte's as you can see the just going to the totals from 1920 2021 we're looking to maintain that same service levels we had a number of vacancies we were ready to fill on pre-covid those refills have been approved we have a staging plan to do that just as the need will arise and ultimately through the city manager's office we were fairly lean and intend on staying that way not adding any staff we also had made a change as far as we had several business unit or two business units planning and building safety we're expanding to add a development services so we can take some of that more where we're doing more things across other departments and being able to track and have better metrics going to the future so you'll see a change in in where those fte allocations are but the overall number stays the same the most current organizational chart is fairly reflective of where we've been we've continued to to to hone and work through development services minimizing staff levels and managing that and this reflects really what that looks like today and going forward to talk briefly on our budget we're we're really where we anticipated being overall in our 1920 estimate we're fairly close preliminarily for 2021 we're looking to do the same thing you'll see a slight variance at at in in the bottom line and ultimately it was council's direction that we look at having 85 cost recovery and we're right in line with that so we have those positions that we're you know that we don't expect the any of our customers with the development community to be funding historic preservation and some of our zoning components compliance etc so we'll continue to maintain that as as requested by council and i'll stand for any questions at this time all right we'll pull the slide down please thank you council member i just want to remind the council members i'm going to be a little bit more firm about it policy question this is a budget presentation so policy questions we're going to need to say for later conversation council member melser yeah uh scott thank you for the presentation i you know back when the shot clock was coming on it seemed like is a pretty grave concern and i imagine you have to do a lot of reorganization to handle it i just uh you know curious to know if it's sort of turned out uh as you expect it doesn't seem like it at this point that you're expressing that it caused you much of a hiccup at all i thought there were going to be a lot more sort of automatic turn downs and just consternation but it doesn't sound like it sounded like that we've worked well with the development community and educated them on and really um coming forward that we need to be more prepared on the front side of the model so it's been somewhat of an advantage in the sense that we're getting more plans um put together when at the time of submittal so we're seeing fewer of those plans coming in for an automatic denial um it has caused a little bit of anxiety in the development community and has been a little challenging for staff but we've been able to overcome just collaboratively yeah well that's great and if i if i i can go a little further mayor um i was wondering as uh you're presenting if your vision onto the level of activity is purely transactional you know just kind of what comes through the process and it seems like a lot of the work of the department is just managing those complicated transactions uh or do you have any kind of uh um figuratively like a map it's a finite number of properties and then do you have a map of here's what's in the works here's what we think will come in the works in the next one year two year five years you know or is it really just what comes at you through the you know through the pipe i think a little of both we so so we do have a interactive map that provides any of the projects that people are making application for so we see what those the potential for growth because not not necessarily where it may just be a zoning change or a request or those pre-application conferences so it does map some of that as well as just our long our long-range planning is we look at what what it is that we anticipate will grow and how it will grow and even through some of those the dialogue that we may have between development community or even economic development where there there is interest so we do we do map and track some of that some of that is available on our online uh map as well thanks council member breaks thank you just uh one question and then a comment the question is um because i've had people reach out to me community concerns about the historic preservation officer and i see that in the fte's it's been approved um i was just wondering if that would be something this year or we're looking at uh next year and then also i just want to commend you on the improvement of development services i know that from where we started five years ago um each year we've improved and the level of service and um cost of service and everything has kept improving so i want to thank you for that well i i'll thank you i'll thank council for for giving us the opportunity to do that um we've got it we've got a great staff and the leadership team here at the city of denton is has just been fully supportive so um without the staff that we have we couldn't do the job that we're doing um so thank you for that um as far as the uh the first part of the question getting into the historic preservation officer that's very important to us and it has been um we were ready to make an offer at the time of of covid so we're we're re-interviewing our candidates that we had for that pool um we don't believe we're going to be able to get the this the person that we selected so um it may happen by the end of the week that we repost that position we've been having some dialogue with the individuals that we did interview and and just want to try to finalize that so we intend on hiring that position just as soon as humanly possible thank you sorry i was on mute councilmember armater i apologize uh thank you so yeah i wanted to ask about the historic uh preservation officer position too uh and it might be a little late for this based on what you just said um but uh has any consideration been given to the the idea was any consideration given to the idea of uh possibly instead of hiring a historic preservation officer having it be a function either of the um the the historic uh landmark committee uh or having some sort of local another local committee that has the the teeth to do this job and also the lived experience of being in denton would that uh is and i know that might sound like a policy point but i'm really as a money saving i'm thinking that that is a policy question i think clearly down they're clearly down the road of of that okay so so i'll i'll i'll reword it in a way that is just focused then on the from a budget perspective why do we need uh um why why is a single historic preservation officer needed for historic uh preservation what can you can you explain uh the need to that the need for that uh absolutely so so the historic preservation plan um is a is a strategic plan as we move forward that position is responsible for managing that plan as well as evaluating the rest of the community and on how it is that we uh maintain the historical properties and how we move forward um so that position then does take feedback and solicit feedback from the community as well as from the historic preservation board uh they're the ex officio to that so it does coordinate all of those pieces uh along with state and federal agencies that we interact with so it is the city having um direct impact to how our how our community develops and it takes the feedback from um our local our local citizens as well as our our committees and thank you so much those are absolutely excellent extremely important goals um uh can you speak to um is has there been a reduction in uh in signage uh for you know when there are changes to historical buildings and if so is that out of budget concern um there have been some changes and we're evaluating that currently and and as we bring someone new on board we'll kind of talk about how it is that we want to promote that to the future just to make sure that any proposed changes that um the community is aware of it okay yeah thank you because that's a concern concern thank you okay any other questions all right thank you scott appreciate it free time is this the one that's bifurcated uh to where we we've got sort of a two-part presentation where we can ask questions i thought i saw in the presentation is that right yes that's correct okay all right thank you all right so this is tony puente with the municipal electric i'm gonna walk through the operational section of um of this budget all right mayor so uh tony pointed like i said um just kind of began first of all i just want to thank our staff for all the work they've done over the last several months certainly the pandemic has um had an impact um but i will tell you that probably more so than ever um our residents certainly rely on electricity certainly them being at home working from home and so i think our staff's been very diligent and making sure that power has continued to be uh very reliable uh so i just really want to thank them for the work they've done um and then more importantly too i will say that even even through this pandemic uh when the city of buoy or town of buoy had an f1 tornado uh go through their town we didn't have a shortage of staff members that were ready to volunteer and so we were able to reach out and help out our our neighbors um so just kind of get started here with some of the accomplishments i'm just going to hit a couple of these certainly happy to answer any questions um afterwards but the one item that i want to mention is this hunter and coal ranch developments as um as you know through that negotiation process we were able to secure all the dual and and triply certified areas of that development uh to be served by dennis electric um over that 30 year build out that's going to be four to six thousand uh new customers that uh will be served um by dme in addition to that uh we were also able to secure the donation of of over 10 acres of property for the underwood substation uh that substation will primarily serve uh those two developments but certainly will will help uh continue to interconnect the system um you know in that southwest uh quadrant of the city and then um the other accomplishment that i want to point out is um you know we were able to achieve 100 renewable power um you know we did have conversations with the council about that and so the goal that we had was that we would be at 100 renewable uh contracted by the end of 2020 and so i can tell you uh that as of today uh we are there uh certainly we have some additional work to to do and in meeting some of the specific directions from the council and i'll touch on that a little bit here um with our future goals so for our future goals for for next year um we are in the process of evaluating um three rfps that we did um submit out to um to the public uh one was a coastal wind 50 to 100 megawatts um the other one was a solar um the same type of of structure and then we also went ahead and did a smaller solar project five megawatts with battery storage to be located in denton we're in the process of of evaluating those rfps we anticipate coming uh to the pub and to the council uh later in august um to kind of review those and and make a recommendation for how do we go forward and again the the goal there would be to to have contracts in place so that when we have expiring contracts primarily the white tail contract expiring in the end of 2023 that we would have new contracts in place to replace that and continue down the goal we have some metrics here that i'll go over in a little bit and then finally number six on this slide is the related to our our meter data we believe that next to our people data is our second top resource we need to get a better handle of that so we hope that going forward that we'll be able to to do some work in that area to be able to one better understand our purchase power needs incrementally but also to be able to give our customers additional control and understanding of their usage so they can better manage that going forward next slide is regarding philosophical changes so certainly over the last year we really had a focus on on reducing our rate pressures a couple of things that we've done have been related to our labor costs so you'll see that in in the slide on fte's we've we've certainly been looking at our labor costs across the the utility i can tell you that we've been able to make some reductions certainly the vsp has certainly helped with that as well but we've been in the process of doing some reorganizations to to become more efficient and frankly to address the fact that we've had a number of vacant positions that have kind of just been held on and so those are now being eliminated i'll tell you that none of that has impacted many of our service levels i think our staff has been very diligent in making sure that that our customers continue to have the power that they need and then also as it relates to our capital program as you know we did reduce the projected bond sale this year by 10 million dollars that was a review of and restructuring of what capital projects we should be funding and when one of those projects was related to the eagle substation we had some conversations with you regarding that and so at present we're not proceeding it's not included in the capital program that you'll see and that'll be about a 17 million dollar savings for our rate payers and so we'll continue to do work on the cip side into the into the next into next year and continue to evaluate and make adjustments as needed so a couple of metrics that i kind of want to go through the first one is related to our renewable energy supply as i mentioned the then renewable resource plan contemplates that we would have 100 renewable under contract by the end of 2020 and and we've achieved that now but but the work is certainly not over we do have a contract with whitetail that will be expiring in december of 23 and so certainly the rps that we're evaluating now will help replace those resources in a manner i think that is more consistent with the council direction and be able to maintain at least 100 renewable power going forward beyond 2023 as i mentioned previously one of those rfps does include looking at battery storage and again we'll we'll be coming back to the council towards the end of august for for a discussion on on those rfps and seeking your direction certainly one of the things that we want to make sure that that we put out there is is where we stand with some of the national averages when it comes to reliability as you know dme has consistently been recognized as a leader in that area and so this is based on the 2017 data national average is about 139 minutes 2019 we're we're at about 39 minutes that is slightly above where we were in 2018 if you might recall we did have a little storm that came through the nottingham area of town that did have an impact and has impact as this data but i think consistently we've been well under that the national average is something that that the city should be proud of and then when it when it comes to competitive rates we've kind of provided you a slide here it is a little dated we do anticipate coming back to you in in november and nick will talk a little bit more about that having more in-depth discussion about rates we'll have a more up-to-date schedule here for not just other municipally owned utilities but certainly some of the private utilities out there and give you that comparison but based on 2019 we're certainly slightly below the middle of the pack here i will tell you that the city of brian as an example is currently looking at a at a pretty substantial rate increase we think we'll be able to update that data you know when we come back to you in november and so i think you know based on our current proposal we'll continue to to be slightly below the middle of the pack here potentially going down a notch or two and i do want to just address quickly a question that we did receive from council member melchler related to the city of lubbock we did a little bit of research on that last night and so certainly a lot of considerations here but just looking at their balance sheet a couple of things that kind of stuck out at me was the amount of debt that they have so so the city of lubbock or lubbock power and light has about 198 million dollars of outstanding debt as of 2019 that's principal and interest that compares to over 800 million dollars that that dme currently has as you know 325 million of that is directly related to the deck and that investment as comparison the city of lubbock power power and light has not made any generation investments substantial ones anyways since the late 90s or in 2000 and so certainly they are currently looking at the potential for for an investment i think they're also looking at some other options that may defer what would be a 300 to 700 million dollar generation investment that they're likely going to forego so a couple of other items that are slightly different that kind of explains why the rate structure is lower they've not made the type of investment in their system both on the transmission distribution side that the municipal electric has made over the last several years you know that that was an investment over 500 million dollars lubbock power and light still maintains a 69 kv line as you know you know we're at 138 for the majority of our system and so again a couple of of things that kind of give you a little bit of flavor for for why their rates may be lower than than than where we are today so this is a reconciliation of our fte's so beginning fiscal year 1920 we were at 189 fte's as i mentioned we even at that point when i came over to dme there was a number of vacancies that we held vacant as we continued to evaluate where the organization was today we're at we're at 169 so we have we had 40 vacancies some of those were related to to the vsp we had 15 individuals at dme take that fte we have a thought to refill some of those so within 20 we have a number of those fte's that went out through the vsp that that we requested to fill and so our new number for fiscal year 2021 is 169 fte's that's a reduction of 20 fte's from what was budgeted in 1920 i will tell you that we feel very comfortable where we are with our fte's and being able to continue to provide power to to the community and but our but our work is still not done there we still have some additional reviews and efficiencies that we're going to be doing over the next several months and so while i'm not sure if this number will necessarily go down we'll certainly be cognizant of that as we continue to focus on reducing rate pressures for for our customers and then finally this is our our current organizational chart i continue to serve as the general manager for denmusipo electric along with assuming managerial responsibility for the other utilities but currently you know terry nolte serves as the assistant general manager and then chris lutrick and smith day are additional managers that also oversee the bulk of dme and currently you have a number of individuals in our operations section brad watts raudy patterson and sam bridges that report directly to me we are currently looking at this at this org chart anticipate some changes coming in in in the very near future and certainly as we make those changes we'll keep you abreast but it'll just be in keeping with us trying to be more efficient and streamline this process so with that that that ends my presentation mayor let me see if i can sure any questions on operations council member briggs thank you mayor at one time the competitive rates chart that we see here with other cities is helpful but at one time i guess a year or so ago someone at dme made a chart like this that was with other private companies and it showed it showed where we are in relation to those other companies which was very helpful when we kept you know we were called the highest around so is that is that available somewhere or is that chart can another chart like that be made yes ma'am that chart i think the one that you're referencing is actually on our website but we do plan when we come back to you in november after we've wrapped up the the fiscal years to have that updated but i will tell you that historically we've we've been about the middle of the pack of of that list as well but we'll certainly have a conversation with you about that and give you some more details on on some nuances to to our rate structure that that sometimes are a little bit different than even what some of the other mo us present as well okay so i look forward to that updated updated chart and and lastly i just wanted to say because a lot of the outages have been in district too i just want to thank you and commend all the um line guys to come who come out and get the electricity turned back on really quickly i know that sometimes we have special circumstances but um for the most part it's it's on and off and so i appreciate that yes ma'am thank you we appreciate that thank you councilman robertor yeah and i i second that and i want to add you know blame the squirrels and our beautiful wonderful trees for a lot of that that damage and the you know line workers really did great job of going out and addressing those issues in that part of town the noddingham woods area really efficiently um i was wondering so several things uh can you speak to uh the changes in metering uh operational needs with the increased move to remote metering i noticed that you know the number of um fte's has gone down from 25 to 22 i don't know if that has anything to do with that i know you still need people to do the work so if you could kind of speak to changes in those needs with that that move yes ma'am so so we have three individuals that accept the vsp and in that specific division um you know one of the things that we have been looking at and working with the water department is looking for some synergies uh between not just the meter reading department because you may or may not know that the reading of water meters is actually housed at dme and then the water department houses the water meter shop and so over the next couple months we'll be working together with the with the water department obviously they now report to me as well so we'll be looking at that entire structure and then hopefully making some recommendations as far as our meter readers are concerned we're down to fte's currently and so we're planning to look at leveraging an outside contract and evaluating that as well as part of this process along with looking at potentially automated water meters in the future when the water department comes and presents that budget to you they'll be talking to you about a study that we're planning commission to look at that and then potentially follow up with some recommendations and so there's certainly some continued efficiencies that we're looking in that area but i can tell you that currently i think we're well staffed in that area we've made some good changes that that area is led by brandon hamby who's our manager of that area and really trust trust him to making sure that that we're being effective and efficient in in reading reading not just the the water meters but certainly our electric meters that are already automated and thank you that was a great really informative answer to that question about the that that chart with with the different cost comparison so i too would i would like to see next time this comes forward to us inclusion you know not just for council you know but for the public too to see comparison of private companies and also if you could speak to you know on that chart as it's currently presented next to all the other city names it says residential and then for denton it's not specified it just has you know the two different fiscal year comparisons so you know i would like to see that and you don't have to speak to that now if there's not time although you're welcome to but you know i would like to see that kind of broken up into commercial versus residential and kind of with and without the the special you know service agreements that are outside of the usual rate structure also how you know comparing cost of service adjustments which i know is a little more complicated but because that factors into the overall cost to we we could certainly tony doesn't it i mean on the chart the city of denton for the fyi 20 and 2019 that's residential is that not that's not commercial and residential that's correct mayor i was gonna say that council member that that is just residential oh okay okay so it would be okay so it would be helpful if so next time if it could just just to specify that um and but i would also like to see how that separated out commercial and residential uh for the different um uh companies uh both public and private um let's see the so i noticed that our our safety and training staff uh for this department are now reduced in half is that compensated for by the new uh safety contract well i'll tell you historically dme has only had two fte's uh for safety um those four was a plan that we had uh going forward that we were going to increase the number of fte's in safety however what i'll tell you is that currently the plan is to fill uh two fte's we actually um had a gentleman that started this week uh we're in the process of hiring a second specialist and then we're going to work with risicon who's now our contract um uh safety for the rest of the city to work with them on you know how exactly we need to um to address safety at the municipal electric if there are additional needs for us to add additional fte's in dme uh then we'll come back to the council with that recommendation in the future but currently it's two fte's and which is what we've had historically okay thank you that is good to know and um and then one more thing you know that i would like to see uh coming coming forward that is i think really important uh and that is it'd be good to see uh the next time electric budget comes forward to council a a slide or two really devoted to a more detailed breakdown of the debt costs including you know insurance um you know possible you know legal expenses involved with with deck um from from personnel from all all different vantage points um it combined with the revenue and also you know net net loss net gain that kind of influences just ma'am and i'll tell you that um this presentation is over isn't that in the next slide yeah that's that we got that coming up nick will come up and he'll present that and we'll be available to answer questions as well but nick's going to do the presentation here shortly okay all right anybody else okay all right thank you tony appreciate it sir good morning mayor city council members it is still morning uh so as tony had said i'm going to present the financial portion of the dme presentation um first before i get started this is an abbreviated presentation we do fully intend to circle back um to both the public utility board and city council november and december this year to have a detailed budget discussion um with you uh so real quick i want to give you a real quick overview of the revenues and expenses for the electric fund we are currently forecasting a three to 3.2 average load growth over the five-year period for electric um our t-cost rate of return so our for our transmission assets we do currently have plugged in at 28.04 percent through fiscal year 2022 oh we are showing a little bit of decrease in that rate of return just to be conservative from 23 to 25 um and then expenses one of the big decisions city council recently made was to increase the rate of return from the electric utility to the general fund to six percent oh we do only carry this out through 2022 starting in 2023 this does go down to 3.5 percent and then we're currently not accounting for any sale the gibbons creek facility we do have 21 point well 21 million in decommissioning costs accounted for in the pro forma and i'll point that out to you shortly um so this is the five-year forecast for the electric fund i'm going to do my best to walk you through this starting in the proposed budget column so you can see here in this column this is the proposed budget for electric for 1920 so the current fiscal year um so we currently do have planned use of reserves of 6.9 million for the fund as you can see the budget includes no rate increases for electric customers end of your projection for electric we are projecting to come in a little bit better they won't be budgeted a lot of this is to do with the cost reduction strategies implemented in the dme budget this year as part of response to covid so you can see the 3.4 million there for a balanced budget for 2021 we do not currently have any planned use of reserves plugged into the electric budget we do actually show a net income of 295 000 we're not forecasting any rate increases in 2021 for dme and then a couple of the things i want to point on this slide that are really important for this fund and you can see the fund balance we have highlighted in yellow to make it transparent for everybody in the public that's viewing this presentation so you can send 73.5 million and if you really want to know how that kind of scales up to what the goal is for this department or this fund and the minimum is 36.9 million with the maximum of 48.5 a couple other things so like i said on the previous slide this does not include any sell of the tmpa facility we do have 21 million dollars in decommissioning cost accounted for in this pro forma so in this purchase power number here where we purchase our power we actually have the decommissioning cost built in so 21 billion dollars and the rate of return i do want to point this out to the council that we have accounted for this return to 3.5 percent in the future years if you come right up here you will see the non-deck revenue and you can see it decreasing from 22 to 23 and the majority that decrease is associated with the roi going down excuse me let me jump that here roi right here you can see the expenses going down from 21.6 to 13.6 a couple of things i think important a couple presentations ago i know city council asked the question about the hunter coal ranch development for each of the utilities the electric fund we do account for the hunter coal ranch development starting in fiscal year 2024 we do start having some revenue show up we do start having some expenses show up and this would be the same for the the water wastewater and solid waste utilities that you see next tuesday so i did want to point that out to the city council today this is the deck pro forma so this was currently or requested just a short bit ago so this is the deck this is part of the five-year forecast that you just saw but we did show the deck separately for transparent transparency so in 2021 you can see the deck we are currently forecasting 24.5 million and this is projected to go down over the five-year period as you can see to 11.5 and a lot of that is based on this note that's down here at the bottom you know as renewable energy continues to come on to the market and you look at that forward curve and it actually has a negative impact to the deck in the out years some of the expenses you can see in the deck pro forma in 2021 we have 33.2 million accounted for expenses with planned use of reserves 8.6 million the five-year capital plan so this starting in 2021 is the proposed budget of course a couple things i do want to point out i know city council and the dme staff had discussed street lighting in the past we are accounting for three million dollars in street lighting in the five-year forecast or the five-year cfp i mean you can see that number right here on this line the hickory creek substation facility you can see this 20.7 million we are accounting for that in 2021 so total debt issuance in the 2020-21 proposed budget is 65 million dollars over the five-year period is 237.6 million i mean all this is accounted for in the five-year forecast that you just saw rate changes we have minimum updates to the rate ordinance so we want to put forward in the city council now we do fully intend to circle back with each of the utilities in november and december to have a detailed rate and budget discussion in november december but for now we would like to clean these up before adoption this coming september the rate ordinance so a couple rates we're looking to discontinue the residential renewable energy service rider also referred to as rg we are looking to discontinue this rate currently customers receive 100 renewable energy and this rate is no longer applicable to the electric fund weekend service also referred to as wk we are looking to discontinue this the recent audit actually revealed that customers were hitting their peak during the week and outside of the weekends so we are looking to discontinue this the downtown decorative lighting ddl we are looking to discontinue this dark fiber we are currently working with tech services regarding this fee that it'll make its way into the tech services fund the commercial renewable energy services cdr also similar to the rg the residential renewable energy services all customers do receive 100 renewable energy so we are looking to discontinue this rate and then the independent wholesale generator also referred to as iwg and then we have a note down here i want to point out really quick so discontinuing of the rg is 186 customers are impacted by this and there's actually going to be an annual savings of $47.36 next steps so we will circle back to the puv on august the 10th they did see this presentation this last monday but we'll circle back on the 10th with them for approval of the budget and rates and then come back to city council on september 15th for adoption of the utility budgets the general fund budget the city manager's proposed budget the tax rate and capital plan then as i mentioned before and tony did also we will do plan to circle back mid-year in december with a budget and rate discussion for the utilities that concludes the presentation mayor i will pull it down for questions questions councilmembrometer and councilmember two things so first of all and thank you for this i i had forgotten that this slide was coming up but it was in my notes about to ask that question um one question that i have about the uh one thing that i would that i would like to see added to those debt costs are uh and maybe this that is what's included part of what's included under miscellaneous is you know any any legal expenses uh expenses outside of of what is listed i was wondering if you could speak to just generally give some examples of what kind of things that miscellaneous category includes and then just one other question in addition to that um i don't have the detail of what's exactly in miscellaneous we definitely can provide that information to you the deck pro forma that you did see would be fully loaded i know earlier we had the comment about the insurance expense and that is included in the five-year forecast but we can get you a breakdown of the miscellaneous category if you'd like to see that thank you i would would love to would love to see that you know around the time when this comes forward to us next um and then from the next question can you is it possible to bring up the slide of the electric pro forma and so people can see who's speaking at the same time or is that not possible yeah i don't i don't know i mean you'd have to be the one that would show up as speaking so i'm not sure tecna do you have the backup on your oh yeah yeah i do so i've got what i need i'm just thinking public you know listening along so anyway i'll try to um to make it clear keeping in mind that that this might not be up on everybody's screen um but about the electric pro forma so i noticed that you know that for a number of years the uh for certain years the total revenue uh is equal to the um or total uh projected uh revenue is equal to the total expenditure in other years um some of which for which there's a planned use of reserves um there's a difference i was wondering kind of if you could speak to uh you know how those projections are made why there for instance from 20 uh 2022 through 2025 we've got to the well no not exactly to the not to the dollar in 2022 but so 2023 and 2025 to the dollar um we've got equal plans you know are projected total revenue total expenditure so anyway i was wondering if you could talk about um kind of how those projections are made and how the planned use of reserves works in regard to planning for that yes i'll be happy to speak to that and i know the presentation isn't up so i'll do my best to kind of walk everybody through it well you could actually if you're talking because you will show up on the screen i think on the feed going out to the public so you could actually put that up and then and walk us through it then as we begin to question we'll need to pull it down there we go okay um so yeah that was a great question um so you can see in 21 and 22 we do have a balanced budget um and actually finishing the year a little bit positive so in 21 or about 300 000 positive and 22 is about 650 000 positive starting in 2023 you can see that reserve usage as you're talking about up here in this blue line so 6.5 million and 23 7 million and 880 000 um the majority of this this decrease in revenue um in this usage of reserves is associated with the t cost rate of return decreasing so in 21 and 22 we currently have it plugged in at 28 percent we are decreasing it to 16 started in 23 so you can see the decrease in the 60 to 48 million there there's a few other things going on in this fiscal year from a non-revenue standpoint on the expense slide as i pointed out earlier and i was in the wrong spot at first but you can see the rate of return you could see you know the budget it was 16 million we're forecasting to come in over budget with the rate of return because of the increased roi for the electric fund but continue that for two and a half years as agreed upon by council and then it decreases back down by 3.5 starting in 2023 so to answer your question there is definitely some movement in revenues and expenses starting in 2023 the majority of the decreases in the revenues that you're seeing is associated with the t cost the transmission rate of return going down does that answer your question yes absolutely and i'll i'll wait a moment for the screen to go back yeah well you're showing up but if we have no but go ahead wait he's got it down now so yeah go ahead so so thank you i just want to say you know and to make clear just how much i appreciate um first of all your explanation and everything that staff is doing to try to mitigate this situation and although you know i'm i'm concerned about you know very concerned and remain concerned uh about uh about the the deck from a financial point of view um i am i i feel very uh confident in you know staff's ability to mitigate that uh and i'm seeing that um in in all of this and in your explanation so i wanted to kind of make clear that for me that's it there's a distinction um between you know my my faith in a gas plant and my faith in people to you know mitigate that mitigate that so i wanted to thank you thank you councilmember davis i just want to kind of distance from that last remark and say i think staff's not mitigating the deck i think they're making excellent use of financial boon to our electrical system and using it as the hedge that it is so um we can talk about environmental issues and mitigation of those but financially the deck is in great shape doing exactly what it was designed to do okay councilmember uh breaks on the projected growth you have it as 3.2 percent load growth is that is that where we had projected because a few i think i seem to recall it was a little bit higher when we were looking at um certain upgrades um let me um terry nalty is going to come up here and talk about the the load forecast for the electric fund really quick hang on just a second councilmember breaks well i can ask more questions yeah yeah well yeah what was your go ahead go ahead councilman the other question was the um the scrubber debt for gibbons creek is that that's not on this you uh the dme budget it is accounted for in the dme budget is an expenditure item to fund that debt service that's correct okay in previous years we had called it out because we were considering paying paying off at 28 million dollars the principal's obviously a little bit less now and we just don't feel comfortable um taking our fund balance down that that far right now so we've made the decision not to pay the scrubber debt offer or just working through our financials as we continue uh assessing what's going to happen with gibbons creek over the next couple of years and how that affects our pro forma but that debt is reflected in this yes and the next thing um hearing the t cos percent um going down are we taking that into account as we look at our cip projects in the future okay i'll turn it over to terry nalty to come up really quick answer both of those questions good morning terry nalty assistant general manager at dme so on the load growth issue the 3.2 percent is the average projected load growth over the the five-year period the actual load growth is uh differentiated into the projected load growth by each year and our forecasts currently show higher load growth in the first two years and then falls back off to this around one and a half percent in 2024-25 time frame the other question with regard to the t cost return uh the transmission cost of service rate is as you know uh administrated and approved by the public utility commission of texas and you you also may recall that uh that rate is one of the highest allowed rates in the state primarily driven by the need to upgrade the transmission system in this part of of the grid um to accommodate the movement of large quantities of west texas wind into the dallas fort worth area and so that incentive rate was put in place in order for us to justify a large expenditure and that's been several hundred million dollars over the last five to seven years the the t cost rate uh is is not something that it changes very often but at any time the public utility commission of texas could call us in for a rate case a full rate case filing we have hedged our our risk here on the implications that that lower rate might have to overall rates by making these assumptions that nick mentioned to 16 percent down to 13 percent in those out years if if that rate were to remain at 28 percent uh those other revenues the non rate revenues would continue to be higher and the uh the net income for the utility would probably be positive in those years if you look at what's happening so i hope that answers your question yeah it does i appreciate that i know that we had made you know around 400 million and part of that um decision was getting the the cost back um for a percentage of those so um i appreciate you explaining that to us now we do we are we are um as evidenced by the the decision or the recommendation that we made with regard to the ego and and hickory substation taking into effect into account the potential for a lower return on investment as we look at our overall investment in the transmission grid we still have a significant level of investment to be made in order to complete the 138 ring okay thank you all right uh council member melzer um i am curious about the um analysis of whether the deck is doing exactly what it was intended to do and uh i wonder if i could kind of pose the question a couple ways um if if we if we didn't okay let me start again having the deck required and taking financing costs out of it we had the upfront expense the 265 million and then the return is the revenue that we get when the deck runs right minus the expense of running it so so does that uh have a positive does that have an internal rate of return greater than our cost of capital i can pull the um deck proform up if you want to see it council member melzer um yes the deck is doing exactly uh what we thought it would do right provides that hedge in the future market so um i can ask terry to come back up and address that question so let me go i also want to say we're not going to begin to start talking about i mean the deck is here so uh whether you you you like that not you council member melzer but whether one likes that or one does it's here we've got to figure out a way to to make it work so i don't want to get into a philosophical discussion yeah i'll take my questions offline because okay still interesting to share no yeah no i appreciate that um okay any other questions okay let's take a quick 10 minute break because it's around lunchtime we've got a couple more presentations but let's take a quick 10 minute break come back welcome back to this meeting of the denton city council on thursday july 30th 2020 it is 1209 p.m i have uh p.m yes i've been informed that our last uh two or three i think is agenda items or or budget presentations uh were added at the last moment uh not the last moment but somehow that the the uh agenda posting didn't get synced up with what we've got so in essence uh our meetings for all intents and purposes over mr hyland or mr leo leo you want to comment on that or no you're you're correct mayor you're correct the last two departments that were added were not posted uh far enough in advance we were trying to add those because you you guys are getting through the budget presentation so fast but it was that posting was missed on on those two specific departments so we'll finish those off next tuesday okay so what that means is we've concluded our work session items and so therefore uh our meeting uh council member breaks well i just i had a question general overall but if i we don't have an item and our meeting is over then i guess i'll wait for the next budget presentation okay all right um yeah okay that's fine you might send that ahead too and they'll be able to answer that ahead of time for when they do present it all right then we will adjourn the meeting at 12 11 on july the 30th 2020 thank you